Millennium Post

CVC seeks report from Finance Ministry on UBI bad loans

The move comes on the basis of a complaint of alleged irregularities against the Kolkata-based bank.  ‘A factual report has been sought from Department of Financial Services (DFS) under Finance Ministry on a complaint against the Union Bank of India (UBI),’ a senior CVC official said.

UBI’s gross NPAs rose 188.3 per cent to Rs 8,546 crore at the end of December 2013. It had Rs 2,963.8 crore of bad loans as on March 31, last year. As per rules, DFS has a maximum of 90 days to send the factual report to the anti-corruption watchdog. The Commission has already received a report on the matter from the bank’s Chief Vigilance Officer (CVO), who acts as a distant arm of the CVC. There have been allegations that UBI’s bad loans were not properly reported, the official said, adding that actual findings by the DFS will give a detailed understanding of the matter.

Amid administrative probe in the matter, the Finance Ministry has accepted UBI Chairman and Managing Director (CMD), Archana Bhargava’s application for voluntary retirement. Bhargava, who took over as CMD on April 23, 2013, cited health ground for seeking premature retirement. Her term was due to end on February 28, next year.

The Finance Ministry is trying to appoint a new CMD to the bank as early as possible, said sources.
It is probably after Bhargava’s voluntary retirement that the Department of Personnel and Training (DoPT) had come out with a directive that no such request can be accepted if a probe is pending.

According to the new rules notified by the DoPT on February 27, it shall be open to the appropriate authority to withhold permission to a government servant if the he or she is under suspension or if a charge sheet has been issued and the disciplinary proceedings against him or her are pending. The DoPT said that the rules were revisited as per a 2010 judgement by the Central Administrative Tribunal.

Tokyo bitcoin exchange blames hackers for theft

The Tokyo bitcoin exchange that filed for bankruptcy protection blamed theft through hacking for its losses on Monday, and said it was looking into a criminal complaint. In an announcement posted on the Mt. Gox exchange’s website, Chief Executive Officer Mark Karpeles outlined the events that resulted in the company’s insolvency and said there was a ‘high probability’ theft was behind the disappearance of bitcoins.

‘We will make all efforts to ensure that crimes are punished and damages recovered,’ Karpeles said. He said Mt. Gox will try to resume business as a way of increasing repayments to its creditors. The online exchange was unplugged early last week as rumours of its insolvency swirled, adding to doubts about the viability of bitcoins overall.

Its woes are a setback for bitcoin, a virtual currency that has grown in popularity since its 2009 creation as a way to make transactions across borders without third parties such as banks.

Bitcoin has also become a highly speculative form of investing. But it has comes with risks, as the Mt. Gox debacle has illustrated, partly as bitcoins are not regulated by central banks or financial authorities.

The statement said illegal access to Mt. Gox in early February abused a bug in its computer system. It also said ‘large discrepancies’ were found between the amount of cash held in financial institutions and the amount deposited by users, meaning that about 2.8 billion yen ($28 million) was unaccounted for.

Karpeles said on Friday that 750,000 bitcoins deposited by users and another 100,000 belonging to the company disappeared. That would amount to about $425 million at recent prices. He repeated the bitcoin numbers in Monday’s statement but said also the complete extent is not yet known.
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