Friday, April 8, 2011

The Fodder Scam 1996 l Rs 950 crore

The Fodder Scam (chārā ghoṭālā) was a corruption scandal that involved the alleged embezzlement of about Indian Rupee ₹950 crore (US$210.9 million) from the government treasury of the eastern Indian state of Bihar.[1] The alleged theft spanned many years, was engaged in by many Bihar state government administrative and elected officials across multiple administrations (run by opposing political parties), and involved the fabrication of "vast herds of fictitious livestock" for which fodder, medicines and animal husbandry equipment was supposedly procured.[1][2][3] Besides its magnitude and the duration for which it was said to have existed, the scam was and continues to be covered in Indian media due to the extensive nexus between tenured bureaucrats, elected politicians and businesspeople that it revealed,[4] and as an example of the mafia raj that has penetrated several state-run economic sectors in the country. Although the scandal broke in 1996, the theft had been in progress, and increasing in size, for over two decades.

The scam

The scam was said to have its origins in small-scale embezzlement by some government employees submitting false expense reports, which grew in magnitude and drew additional elements, such as politicians and businesses, over time, until a full-fledged mafia had formed.[4]Jagannath Mishra, who served his first stint as the chief minister of Bihar in the mid-1970s, was the earliest chief minister to be accused of knowing involvement in the scam.[5]
In February 1985, the then Comptroller and Auditor General of India, T.N. Chaturvedi, took notice of delayed monthly account submissions by the Bihar state treasury and departments and wrote to the then Bihar chief minister, Chandrashekhar Singh, warning him that this could be indicative of temporary embezzlement.[6] This initiated a continuous chain of closer scrutiny and warnings by Principal Accountant Generals (PAGs) and CAGs to the Bihar government across the tenures of multiple chief ministers (cutting across party affiliations), but the warnings were ignored in a manner that was suggestive of a pattern by extremely senior political and bureaucratic officials in the Bihar government.[7] In 1992, Bidhu Bhushan Dvivedi, a police inspector with the state's anti-corruption vigilance unit submitted a report outlining the fodder scam and likely involvement at the chief ministerial level to the director general of the same vigilance unit, G. Narayan.[8][9] In alleged reprisal, Dvivedi was transferred out of the vigilance unit to a different branch of the administration, and then suspended from his position. He was later to be a witness as corruption cases relating to the scam went to trial, and reinstated by order of the Jharkhand High Court.

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