Scams through the ages

Ac­quit­tal in 2G case fol­lows a pat­tern. What to do to break it and en­sure con­vic­tion?


With the ac­quit­tal of all the ac­cused in the 2g scam and con­vic­tion of Lalu Prasad Ya­dav in the chara gho­tala, scams are in the head­lines again. We in­di­ans love scams so much that the word ‘scam’ is now part of all in­dian lan­guages though the mean­ing is not the same as in english. in in­dian lan­guages ‘scam’ is not any dis­hon­est scheme but a big-ticket swin­dle in­volv­ing top peo­ple. Any in­dian, whether ed­u­cated or not, is fully aware of the en­tire spec­trum of scams – from Bo­fors to 2g.

But look­ing at the fre­quency with which scams take place in in­dia the rel­e­vant ques­tion is: has any­one in au­thor­ity tried to an­a­lyse past scams with a view to pre­vent their re­cur­rence? The answer ap­pears to be an un­am­bigu­ous ‘no’. rather, a good scam is wel­comed by all out­side the gov­ern­ment; it pro­vides good copy for the me­dia, en­ter­tain­ment for cit­i­zens and a ral­ly­ing point for the op­po­si­tion.

A scam be­comes a po­lit­i­cal is­sue right from the day it is re­ported. All op­po­si­tion par­ties start de­mand­ing the gov­ern­ment’s res­ig­na­tion while the gov­ern­ment starts list­ing out the scams which oc­curred when the op­po­si­tion par­ties were in power. Mean­while, the per­pe­tra­tors of the scam roam free. Years are taken by in­ves­ti­gat­ing agen­cies to file charge-sheets which typ­i­cally run into thou­sands of pages. no won­der, court pro­ceed­ings drag on for decades. By that time in­ves­ti­gat­ing of­fi­cers have re­tired, most of the cul­prits are dead and the per­sons who had un­earthed the scam have lost in­ter­est.

The Bo­fors scam, which first sur­faced in 1987, ex­em­pli­fies the life­cy­cle of a typ­i­cal scam. The mas­sive pub­lic­ity given to the Bo­fors scam led to the down­fall of the ra­jiv gandhi gov­ern­ment in 1989. Hav­ing won elec­tions on the Bo­fors plank, VP singh, the next prime min­is­ter, promised that the Bo­fors cul­prits would be put be­hind bars within 15 days. How­ever, the first charge-sheet in the Bo­fors case was filed in Oc­to­ber 1999 which was quashed by the delhi high court in 2004. By now, the main drama­tis per­sonae of the Bo­fors scam are dead. no part of the al­leged il­le­gal com­mis­sion of ₹64 crore has been re­cov­ered and no one has gone to jail for per­pe­trat­ing the scam.

But the Bo­fors scam had a very dam­ag­ing se­quel. Af­ter the scam, Bo­fors was black­listed and no pur­chases were to be made from the com­pany. At the time of the Kargil war, we had the Bo­fors gun but no am­mu­ni­tion to feed it. in des­per­a­tion, we pur­chased am­mu­ni­tion at the rate of $10,000 per round from south Africa. The en­tire cost was never of­fi­cially re­vealed but given the fact that the Bo­fors gun fires three rounds per minute, the cost must have been astro­nom­i­cal. it is a mat­ter of record that the Bo­fors gun proved it­self in bat­tle and turned the tide of the Kargil war de­ci­sively in our favour. How­ever, af­ter black­list­ing Bo­fors, we could not get the ben­e­fit of the sec­ond part of the con­tract with Bo­fors – which would have al­lowed us to man­u­fac­ture the Bo­fors gun in­dige­nously. The in­famy as­so­ci­ated with Bo­fors has rubbed off on all de­fence pur­chases and has en­sured that till today es­sen­tial de­fence pur­chases drag on end­lessly. even thirty years af­ter the Bo­fors scan­dal, we have not been able to fi­nalise a suc­ces­sor to the Bo­fors gun. Thus look­ing back at the Bo­fors scam we are left won­der­ing if there was any scam at all or whether it was all made up for po­lit­i­cal ben­e­fits. How­ever, what is un­ques­tion­able is that our un­pre­pared knee­jerk re­ac­tion caused un­told harm to the coun­try. The Te­helka sting (2001), which showed that ev­ery­one from clerks to min­is­ters was will­ing to sell the se­cu­rity of the coun­try for ridicu­lously small sums,

The CBI would try to prove that the scam­sters did not fol­low proper pro­ce­dures, the in­come tax dept would try to prove that the scam­sters did not pay in­come tax, while the ED would play on the money-laun­der­ing an­gle. The whole case be­comes a jig­saw puz­zle – too com­pli­cated for the courts to re­solve in any fi­nite pe­riod of time.

proved that no steps had been taken to pre­vent re­cur­rence of a scam of the Bo­fors type. The only fea­ture dis­tin­guish­ing the Te­helka scam from the Bo­fors scam was that jour­nal­ists and in­vestors were jailed af­ter the scam was re­ported.

The af­ter­math of the Bo­fors and Te­helka scams is not ex­cep­tional. other scams like the 2g and or­gan­is­ing the 2010 com­mon­wealth games also had the same de­noue­ment. no one was pun­ished, cases dragged on till eter­nity in var­i­ous courts and no part of the de­fal­cated cash was re­cov­ered. Why was it so? For one, the in­ves­ti­gat­ing agen­cies pros­e­cute scam cases se­lec­tively. They are lib­eral with some per­pe­tra­tors and strict with oth­ers. once the gov­ern­ment changes; the in­ves­ti­gat­ing agen­cies change their tune. More of­ten than not, it is dis­cov­ered that per­son­nel of the in­ves­ti­gat­ing agen­cies were col­lud­ing with the per­sons they were sup­posed to in­ves­ti­gate. in Telgi’s stamp-pa­per scam it was the Mum­bai po­lice com­mis­sioner, in the 2g scam it was the cbi direc­tor and in the Adarsh scam it were the gov­ern­ment ad­vo­cates. no won­der most scam­sters go un­pun­ished and af­ter the spot­light fades they coolly en­joy the pro­ceeds of their crime.

The sec­ond rea­son is that once a juicy scam breaks out, all in­ves­ti­gat­ing agen­cies run hel­ter-skel­ter af­ter the scam­sters. This may not ap­pear to be a bad idea; but on the ground this de­rails the in­ves­ti­ga­tion be­cause all agen­cies pur­sue dif­fer­ent goals and guard (but never share) any in­for­ma­tion they gather. Thus the cbi would try to prove that the scam­sters did not fol­low proper pro­ce­dures, the in­come-tax depart­ment would try to prove that the scam­sters did not pay in­come-tax while the en­force­ment direc­torate would play on the money-laun­der­ing an­gle. con­se­quently, the whole case be­comes a jig­saw puz­zle – too com­pli­cated for the courts to re­solve in any fi­nite pe­riod of time.

Thirdly, the gov­ern­ment of the day puts all its might in de­fend­ing the scam­sters. it is a mat­ter of record that the then prime min­is­ter Man­mo­han singh de­fended the coal­gate and 2g scams in par­lia­ment. The in­fa­mous Vya­pam scam in Mad­hya Pradesh found men­tion in a us state depart­ment re­port on ‘Hu­man rights Prac­tices in in­dia for 2016’ but the party in power, BJP, promptly is­sued a state­ment de­nounc­ing the us for dar­ing to com­ment on the Vya­pam scan­dal re­gard­less of the fact that forty un­nat­u­ral deaths have taken place since it first sur­faced and the press, the whistle­blow­ers and even con­cerned cit­i­zens have been threat­ened. of course, no one has been pun­ished in the Vya­pam scam ex­cept for the 634 stu­dents whose de­grees were can­celled by the supreme court. even in light of such dis­qui­et­ing facts the MP gov­ern­ment chooses to adopt an am­biva­lent at­ti­tude; play­ing down the scam in one breath and promis­ing ac­tion against the scam­sters in another. A charge-sheet has been filed only now; res­o­lu­tion is a long way off.

even more strange is the case of the Adarsh Hous­ing scam, where top politi­cians, bu­reau­crats and army of­fi­cers cor­nered flats meant for Kargil wid­ows. de­spite in­dict­ment by a ju­di­cial com­mis­sion in 2011, the four for­mer chief min­is­ters and two min­is­ters are still at large. some bu­reau­crats have been sus­pended and some army of­fi­cers have been ar­rested and re­leased on bail but the case is nowhere near res­o­lu­tion. As­ton­ish­ingly, the Bom­bay high court has even with­drawn the sanc­tion for pros­e­cu­tion of Ashok cha­van, an ex-cm.

The fail­ure of in­ves­tiga­tive agen­cies to nail the cul­prits in high pro­file cases has led to jus­ti­fied re­sent­ment and anger among the pub­lic. A num­ber of What­sapp mes­sages are cir­cu­lat­ing which list the cases where courts ac­quit­ted

the ac­cused af­ter much hype by the me­dia and po­lit­i­cal par­ties. need­less to say, such mes­sages im­plic­itly ques­tion the very ba­sis of our sys­tem. To re­store the con­fi­dence of the pub­lic in the gov­ern­ment, it is es­sen­tial that the di­ver­gence be­tween pub­lic and ju­di­cial per­cep­tion should be bridged.

ide­ally, a stan­dard op­er­at­ing pro­ce­dure (sop) should be de­vised to deal with scams with a view to (a) pun­ish the guilty, (b) re­cover the money earned il­le­gally, and (c) pre­vent the re­cur­rence of sim­i­lar scams. The first step would be to have a sep­a­rate law for scams. Once a crime is clas­si­fied as a scam, an in­ter-min­is­te­rial spe­cial in­ves­ti­ga­tion team (sit) would be con­sti­tuted. The team would have peo­ple from the cbi, ed and in­come tax depart­ment. if nec­es­sary, banks and cus­toms would also be as­so­ci­ated. The ju­ris­dic­tion of all other agen­cies would be ousted. The sit would be re­quired to sub­mit a re­port within a def­i­nite pe­riod, say three months or six months, and file a charge-sheet si­mul­ta­ne­ously. The court would be obliged to hear scam cases on a day to day ba­sis and de­cide such cases ex­pe­di­tiously. Pub­lic ser­vants (politi­cians and bu­reau­crats) found guilty of par­tic­i­pat­ing in a scam would be de­barred from hold­ing pub­lic of­fice for ever. The SIT would also be obliged to sug­gest ways to re­cover the money lost in the scam. ev­ery year the sit would sub­mit a pub­lic re­port so that the scam does not van­ish from pub­lic mem­ory.

of course, what i have sug­gested is not fool­proof. A law can only be as strong as its en­forcers. Hap­haz­ard ac­tion by the in­ves­ti­gat­ing and reg­u­la­tory agen­cies has be­come so far­ci­cal that top serv­ing bu­reau­crats pub­licly lay the blame for their in­ac­tion on the ‘5cs’ – cbi, cvc, cag, cic and the courts. This view is not as ir­ra­tional as it seems. if we look at the 2g scam, we can­not help but no­tice that the de­ci­sion to al­lot air­waves on ‘first come first served ba­sis’ was a very sound pol­icy de­ci­sion of the gov­ern­ment. This pol­icy en­sured that mo­bile tele­phony rates in in­dia are the cheap­est in the world. even the poor­est in­dian has a mo­bile phone and all in­di­ans can par­tic­i­pate in the dig­i­tal revo­lu­tion. Prime min­is­ter Modi has re­peat­edly stated that all gov­ern­ment pro­grammes, be it sub­sidy hand­outs or dig­i­tal pay­ments, would have mo­bile tele­phony as their de­liv­ery plat­form. This would not have been pos­si­ble if the air­waves had been auc­tioned and mo­bile had been that much ex­pen­sive. of course, the per­sons dis­pens­ing air­waves made sure that they had feath­ered their nests be­fore ben­e­fits reached any­one. ditto for coal­gate. not auc­tion­ing coalmines was a sound pol­icy de­ci­sion. Had coalmines been auc­tioned, coal which is an es­sen­tial in­put in elec­tric­ity gen­er­a­tion and many other in­dus­trial pro­cesses would have been much more ex­pen­sive. This would have pushed up prices of all com­modi­ties and would have hit all man­u­fac­tur­ing in­dus­tries badly. But here also, the per­sons in power al­lot­ted coalmines to un­de­serv­ing per­sons en­rich­ing them­selves in the process. Thus in the ul­ti­mate anal­y­sis, both 2g and coal­gate were in­stances of com­mon cor­rup­tion and not scams in which the in­ter­ests of the coun­try were sold down the river. Looked at in this per­spec­tive, even Bo­fors was hardly a scam. The Bo­fors gun was the best in its class and was se­lected af­ter a se­ries of tri­als. Bribes were paid be­cause politi­cians never do any­thing with­out ‘Vi­ta­min M’ and arms deal­ers have an un­bro­ken history of pay­ing money to who­ever buys their out­ra­geously priced goods.

of course, all in­stances of cor­rup­tion in high places lower pub­lic con­fi­dence ir­re­triev­ably. Peo­ple be­gin to think that if their rulers are en­gaged in mas­sive cor­rup­tion they would be jus­ti­fied in en­gag­ing in cor­rup­tion in their small way. in this way, the moral fab­ric of the en­tire coun­try is de­stroyed. More­over, af­ter be­ing per­ceived as cor­rupt, the moral au­thor­ity of lead­ers di­min­ishes so much that fringe el­e­ments ped­dling com­mu­nal­ism and casteism as­sume lead­er­ship roles.

re­gret­tably, some­times scams are “in­vented” to score brownie points lit­tle re­al­is­ing that such al­le­ga­tions harm the rep­u­ta­tion of the en­tire po­lit­i­cal and bu­reau­cratic struc­ture – not only po­lit­i­cal op­po­nents. in the 2g case, the the­ory of pre­sump­tive loss, so as­sid­u­ously ped­dled by the cag and ac­cepted by the pub­lic was not enough to es­tab­lish the crim­i­nal­ity of the per­sons but none­the­less dam­aged the rep­u­ta­tion of the then gov­ern­ment and scores of peo­ple through a me­dia trial. The out­come would have been dif­fer­ent had the in­ves­tiga­tive agen­cies cool-head­edly eval­u­ated their chances of suc­cess be­fore em­bark­ing on a wild goose chase. of course, the agen­cies should also have avoided se­lec­tive leaks while the case was still un­der in­ves­ti­ga­tion, which tar­nished the rep­u­ta­tion of the per­sons in­volved and raised the ex­pec­ta­tions of the pub­lic for a quick con­vic­tion. even now, the Bo­fors scam is be­ing res­ur­rected for po­lit­i­cal gains. if the pros­e­cu­tion fails again (as it pos­si­bly would), it would be another blow to the cred­i­bil­ity of the sys­tem.

In the fi­nal anal­y­sis, to pre­vent scams, the rul­ing classes have to re­alise that there is no good scam – even if their own friends and party mem­bers are in­volved. Till this re­al­i­sa­tion dawns, we will con­tinue hav­ing un­re­solved scams which would make cor­rup­tion a way of life in our coun­try.

Of course, all in­stances of cor­rup­tion in high places lower pub­lic con­fi­dence ir­re­triev­ably. Peo­ple be­gin to think that if their rulers are en­gaged in mas­sive cor­rup­tion, they would be jus­ti­fied in en­gag­ing in cor­rup­tion in their own small way. In this way, the moral fab­ric of the en­tire coun­try is de­stroyed.

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