Some key questions that come to my mind regarding the latest scam are:
a) What are the guidelines defined in our banking system before Letters of Undertaking (LoUs) are issued in favour of some clients? As these guarantee liability payments by one bank to another, isn't creditworthiness besides impeccable business credentials of their favored clients supposed be the topmost criteria?
b) As PNB's SWIFT system wasn't 'married' to their core banking system, was this not known either to the RBI or the powers that be at PNB since ages? Or did it come as news when this scam unfolded?
c) As Nirav Modi's firm managed to get LoUs issued without any margins for whatever reasons, how can he be accused for fraud, unless it is proved that he made fraudulent representations to avail of the same?
d) The ex-PNB staffer who is making news should be the one on the dock for using SWIFT system as his personal email id. The least that could have in put in place by RBI was to have two key authorities of the bank from different departments to authenticate such messages, so as to at least eliminate the possibility of one authority being compromised to the detriment of bank's interests.
e) As the beneficiary of LoUs would have been Modi's business partners, it is going to be an herculean task for our investigators to nail Modi guilty of any crime unless they conduct a forensic audit of the amounts released on the basis of such LoUs to identify its trail of movement,
f) And above all, it is indeed mysterious that how come not even the RBI considered it prudent to conduct forensic audits of such instruments like LoUs and SWIFT systems as a precautionary measure, to ensure that there was no compromise on the interests of the banks concerned?
Perhaps, this incident should serve as a wake-up call for our entire banking system, and lets hope and pray that is the last of such scams.
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