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It is easy to fall for the stocks of glamorous sectors, promoters or companies, especially since they figure prominently in the popular media all the time. This is a recipe for disaster, as Moneylife Research Desk shows
Mix the following and shake well: glamorous businesses, dumb institutional investors, ambitious promoters and market valuation (not cash flow) as the key result area...
Speak Asia COO Tarak Bajpai has been granted bail, but he is afraid that police from other places may arrest him. According to sources, the company may approach the Supreme Court to seek anticipatory bail
Speak Asia, the troubled multi-level marketing (MLM) company, could remain in the water for many more days, if not some months or years. The company's chief operating officer (COO) Tarak Bajpai, who is in custody, is apparently not willing to come out of jail fearing that police from other states may be looking to arrest him.
According to information posted on the Internet by some agents of Speak Asia, Mr Bajpai was granted bail by the Thane District Court. However, police from Madhya Pradesh, Rajasthan, Goa and Pune were said to be waiting outside the court to arrest Mr Bajpai. So, in order to avoid being arrested all over again, the company's counsel advised that Mr Bajpai petition the Supreme Court for anticipatory bail.
One such post reads: "Court ne bail manjoor kar li, lekin layer (lawyer) ne mana kar diya kyoki aur jagah se complain bhi hua hai. Agar Tarak sir baahar aate toh fir se giraftar ho jate. Is isthiti (is paristhithi) mein layer (lawyer) ne nirnay liya ki ab Supprim Court se Agrim jamant lenge. Jis se ki jo aur jagah company ke khilaf FIR hua hai, koi pooch tach ke liye inko giraftar na kare. MONDAY ko SC se bail mil jayega, tab Tarak sir bahar aa jayenge, fir SOAL ka painding work shuru ho jayega." However, this information could not be confirmed from the company's legal team.
In the meanwhile, according to some panellists, the company has also requested the Reserve Bank of India (RBI), to postpone its meeting, citing non-availability of its officials. Speak Asia had asked for an appointment with the RBI and accordingly the central bank had fixed a meeting for 24th August, in the second half of the day. However, on the morning of 24th August, Speak Asia sent an email to the RBI saying that since its officials were in jail, the meeting be postponed to another date. Speak Asia had to get an order from the Bombay High Court to fix an appointment with the RBI.
This statement from Speak Asia is yet another example of the lies the company has been spreading. Harendar Kaur, chairperson and chief executive officer (CEO) of Speak Asia (see the image below), had sent a letter seeking an appointment to the RBI. Manoj Kumar, the company's CEO for India, is alleged to be in hiding in Dubai, while there is no information about other officials, like Narayanan Rajagopalan, president for emerging markets, and Vivek Gautam, chief marketing officer (who was reported to have been sacked for making big claims about big clients).
Some other officials of the company were also present at the press conference called by Speak Asia on 16th May in Mumbai, but there is little information about their whereabouts. Till date, the Mumbai police and the Economic Offences Wing (EOW) have arrested only one official, that is Tarak Bajpai. The question is why is Speak Asia making it out to be as if many of its officials are in jail?
Only yesterday, during the hearing on two public interest litigations that highlighted the two scams involving Speak Asia and Symbiosis Investment, a division bench of Justice Ranjana Desai and Justice Rajesh Ketkar remarked that such offences should be investigated expeditiously to provide quick relief to victims.
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It might be surprising to know what our babus can do to stop corruption. The second part of a three-part article highlights three instances of honesty and bravery of IAS officers
"Corruption is not just about money. It is also about ethics in public life. Anything that violates it can trigger public anger."
—Venu Srinivasan, managing director, TVS Motors
Let me ask you a question. Which homogenous section of citizens in India can, and must be the first bulwark to hold off the tidal waves of corruption that have been sweeping our land for three decades and more?
Don't laugh. My answer is, the bureaucracy, particularly the Indian Administrative Service.
Do you know apart from the judgments of the Supreme Court which are the opinions that are most difficult to overturn? These are the jottings of senior bureaucrats (of the level of joint secretaries and above) in files dealing with matters involving large sums of money. I make this statement confidently after reporting on the affairs of government for four decades.
For example, a senior bureaucrat vets a file containing a proposal to buy equipment for a public sector company. The amount involved runs into a couple of hundred crores. The bureaucrat senses something fishy in the proposal; he feels that somebody, probably a minister, will get kickbacks. He notes his objection diplomatically: the amount is too high and the proposal can be passed if the cost is cut by, say, Rs50 crore. Any possibility of a kickback is thus thrown out of the window.
No minister, unless he or she is foolishly brave, or courageous as Sir Humphrey Appleby put it in "Yes, Minister", will risk overturning this opinion. The facts could come out any day, the bureaucrat may leak the story to a friendly newspaperman, the Comptroller and Auditor General of India may pounce on it, the vigilance guys may sniff something. It's too dangerous. The minister decides to either drop the matter or move it through another bureaucrat who may be more accommodating.
This is not an imaginary situation. It happens a lot of the time when the bureaucrat is honest and unafraid. Here are three examples about which I have personal knowledge.
In the mid-80s, an international tender was put out for building the HBJ pipeline from Hazira in Gujarat to Jagdishpur in Uttar Pradesh. There were four bidders and two frontrunners emerged: Spie Capag of France and Snam Progetti of Italy. The representative of Snam Progetti was Ottavio Quattarochi, the infamous friend of Sonia Gandhi.
Snam's bid was $100 million costlier than that of Spie Capag. Banking on his well-known friendship with the prime minister's family, Mr Quattarochi tried to use muscle. He is even reported to have personally threatened the then petroleum secretary, GV Ramakrishna. The difference of $100 million in the bids was too much for Mr Ramakrishna to accept. He stood firm in the decision to award the contract to Spie Capag. Even Rajiv Gandhi did not dare interfere. Mr Quottarochi lost and the country saved $100 million.
Next, during Jayalalitha's previous stint as chief minister, the Tamil Nadu Electricity Board put forward a proposal to import high quality coal costing hundreds of crores. One IAS officer, by the name of Mr Sundaram, who was the secretary to the Tamil Nadu government in charge of coal imports, smelt a rat. The coal was too costly; surely a kickback was involved. Mr Sundaram wrote in the file his refusal to clear the import. There was a kickback-this became public knowledge later-and even even Jayalalitha had to back down. Of course, she made life miserable for Mr Sundaram and within a year he resigned from the IAS.
The third instance involves the issue of shares by Southern Petrochemicals Industries Corporation (SPIC), a joint venture with the Tamil Nadu government through the Tamil Nadu Industrial Development Corporation (TIDCO). The chairman of TIDCO was Ms Chandralekha. She found that the share issue would result in heavy losses to the Tamil Nadu government and objected strongly. Jayalalitha backed off for a while.
Some weeks later, Ms Chandralekha was travelling in a car, in heavy traffic, when some goonda put his hand through the window of the vehicle and threw acid on her face. She was horribly burned. Ms Chandralekha resigned from the IAS. There was absolutely no reason for the attack, but the public drew its own conclusions. Ms Chandralekha later joined the Janata Party and became a close associate of Subramaniam Swamy.
If only there were 5,000 IAS officers who are prepared to act as honestly and bravely! If a few IAS officers can block high-level corruption, what is there that cannot be achieved by a band of motivated people?
(R Vijayaraghavan has been a professional journalist for more than four decades, specialising in finance, business and politics. He conceived and helped to launch Business Line, the financial daily of The Hindu group. He can be contacted at [email protected].)