The Fourth Estate has stood true to its sobriquet of a “watchdog” by exposing a number of scams since the country attained Independence. Despite the threats and baits thrown at it the Media has taken on the establishment and the powers that be to uphold their duty of exposing wrongdoings, says Nikita Shastri.
Recently, Union Finance Minister Nirmala Sitharaman said, in Rajya Sabha, that fugitive economic offenders Vijay Mallya, Mehul Choksi and Nirav Modi will be coming back to India and face the law of the country. Liquor baron Vijay Mallya, also owner of the now-defunct Kingfisher Airlines, has been accused of committing fraud and laundering the Rs 9,000 crore he took as loan from several Public Sector Undertaking (PSU) banks and with no intention to return. Concurrently, Mehul Choksi and Nirav Modi, the prime accused in India’s largest bank fraud – the Rs 13,600 crore Punjab National Bank (PNB) scam – left India in 2018. The duo has been involved in the scam involving fake guarantees in the name of the state-run lender to secure loans overseas.
The Indian media, since independence, has uncovered several high-profile scams and scandals over time, without fear or trepidation. No one can forget the Bofors Scam that exposed the top political tier of the country or the Fodder Scam the extent of which shocked the nation. Media has played an important role in keeping the masses informed and in keeping the executive, legislature and judiciary in check. Journalists have time and again questioned the powerful despite the threats, attacks even fatalities and many continue to do so upholding their duty as the Fourth Estate.
The big scams that shook the nation
In the last three decades, with the privatisation and the diversification of media, many more scandals and scams involving powerful politicians, industrialists, celebrities, etc. have been exposed by the media. The Bofors Scam, a weapons-contract political scandal involving India and Sweden and initiated by members of the political party Indian National Congress was one of the first scams that made national news. The scam went on to involve several powerful politicians from Indian and Swedish governments including Indian Prime Minister Rajiv Gandhi. They were accused of receiving kickbacks from Swedish arms manufacturer Bofors AB for winning a bid to supply to India their 155 mm field howitzer guns. It was a report in The Hindu by N Ram and Chitra Subramanian that exposed the scam. As many as 350 documents relating to the weapons deal, the kickbacks to flout the law and illegal bypassing of due processes pertaining to the deal were exposed too.
The Fodder Scam was a corruption scandal involving the embezzlement of INR 9.4 billion (equivalent to INR 39 billion or USD 540 million in 2019) from the government treasury of the state of Bihar. The scandal was exposed by journalist Ravi Jha working with the Asian Age in Calcutta at the time. Among those implicated and arrested were the-then Chief Minister of Bihar Lalu Prasad Yadav and the former Chief Minister Jagannath Mishra.The scandal also led to the end of Lalu’s long reign as Chief Minister. On 23 December 2017, Lalu Prasad Yadav was convicted by a special CBI court while Jagannath Mishra was acquitted.
The financial scam that affected all
The 1992 Securities Scam involving stock broker Harshad Mehta was exposed by journalist Sucheta Dalal. The scam amounting to Rs 1,000 crore severely disrupted the Indian stock market.
The scam was a market manipulation masterminded by stockbroker Harshad Mehta and involving other bankers and politicians. Mehta who was considered superstar of the Indian stock market was then banned from the stock market after the scam came to light.
Harshad Mehta used techniques that included fake cheques signed by corrupt officials, misusing market loopholes and public manipulations to drive the prices of stocks up to 40 times their original price. Through interbank transactions, Mehta and his associates had reportedly managed to siphon a huge amount of money.
Harshad Mehta had identified loopholes and irregularities in the banking system, due to which the stock traders started making good returns by fraudulently obtaining unsecured loans from banks.
In April 1992, when the scam was discovered, the Indian stock market collapsed. The scam was the biggest money market scam ever committed in Indiatuning to the amount of approximately Rs 5000 crore. After the scam exposed loopholes of the Indian financial systems, a complete and total reformation of the system of stock transactions was undertaken including introduction of online security systems
Interestingly, the stock market scam was dramatised in the 2020 web series Scam 1992 created by Hansal Mehta. Actor Pratik Gandhi played Harshad Mehta and Shreya Dhanwanthary enacted the role of journalist Sucheta Dalal. The series was adapted from Sucheta Dalal and Debashish Basu’s 1992 book ‘The Scam: Who Won, who Lost, who Got Away.’ Released in 2021, Hindi-language film The Big Bull featuring Abhishek Bachchan is also based on the related scam. The storyline of the film is based on the life of Harshad Mehta, played by Abhishek, a stockbroker, involved in financial crimes over a period of 10 years, from 1980 to 1990.
Media coverage ensured timely action
Not only do journalists expose scams revealing individuals and entities scamming the common man and the nation, the constant media coverage of scams also helps in keeping public memory fresh and building pressure on the authorities to act in a timely fashion. The scam involving flamboyant industrialist Vijay Mallya aka ‘King of Good Times’ has been one of the largest financial scams in the country. Liquor baron Vijay Mallya absconded from India and took shelter in the UK in 2016 after reports accusing him of fraud and money laundering surfaced. Vijay Mallya allegedly owes, till date, various banks over Rs 9,000 crores, which he’d taken as a loan to keep his now-defunct Kingfisher airlines from failing. He was recently declared a fugitive economic offender under the Fugitive Economic Offenders Act.
Talk of scams would be simply incomplete without the mention of Abdul Karim Telgi who was believed to be at the center of the Stamp Paper Scam of 2001. A native of Khanapur in Karnataka, Telgi was a child when his father died. The family sold fruits, vegetables and peanuts to passengers in trains.
Telgi completed his schooling, pursued a B.Com degree from a college in Belagavi and moved to Mumbai to earn a living. After spending some time in Mumbai, he left for Saudi Arabia to look for better prospects and upon return to Mumbai started his ‘business’ of selling fake stamps and stamp papers.
Telgi became a travel agent and began forging several documents and stamp papers to send manpower to Saudi Arabia. He came under the radar of the immigration authorities in 1993 and was jailed for cheating and forgery at the MRA Marg police station in South Mumbai. Here, Telgi met Ram Ratan Soni, a government stamp vendor operating from Kolkata and decided to commit bigger scams.
More recently, the Punjab National Bank (PNB) Fraud Case involving Nirav Modi and Mehul Choksi rattled the nation’s conscience. The scam relates to fraudulent letter of undertaking worth Rs 11,356.84 crore (USD1.4 billion) issued by the Punjab National Bank at its Brady House branch in Fort, Mumbai, making Punjab National Bank liable for the amount. Organised by jeweller and designer Nirav Modi, it involved other members of the family including uncle Mehul Choksi. Nirav Modi and his family absconded in early 2018just before the news of the scam broke in India and in March 2019 he was arrested in the UK.
On 1 March 2018, the government approved the Fugitive Economic Offenders Bill to deter economic offenders from evading the process of Indian law by giving powers to the government to confiscate assets of a fugitive, including Benami assets of absconding loan defaulters.