MUMBAI, April 21: Justice S N Variava of the Special Court on Tuesday directed Standard Chartered Bank (SCB) to furnish proof that the bank had acted and taken corrective measures on the complaint of an executive of the merchant banking division of the bank.The complainant, Prakash Yardi, has informed his higher-ups in September 1990 that the bank was exposed to substantial credit risks and was also contravening the RBI regulatory controls.While hearing an application of Bhupen Dalal, a notified party in multi-crore securities scam, Justice Variava told the Stanchart counsel, "I would like to see what steps were taken to rectify the wrong happenings in the bank."According to Variava, if the bank fails to furnish this proof then the motive is clear that Stanchart was voluntarily flouting the regulations in return for assured gains. The bank will furnish its report on May 4.At Tuesday's hearing, Justice Variava heard the CBI counsel, V C Gupte. The agency was instructed, at the last hearing, toprove whether Stanchart had given crores of rupees to Hiten P Dalal, a scam-tainted broker, against an assured return of 15 per cent.The judge observed that the criminality was confirmed in the transactions between Hiten Dalal and the bank as there was no breach of trust. According to Justice Variava, Stanchart was flouting the guidelines only to earn 15 per cent assured returns. Dalal, in his application seeking direction from the court to ask CBI to further investigate transactions of Stanchart during the scam , has wondered where Rs 889 crore of Stanchart could have disappeared without a trace.
