Examining the impact of political relations in corporate world: the case of PNB

Abstract

With the rising incidents of corporate scams, it has become imperative to lift the corporate veil to unearth the reasons behind them. As a result, it is of paramount importance to examine the formation of the companies entering into the contract - the executives, directors and top management level and try to determine whether there is any underlying relation to the political world. The PNB case hit the bank and its financial position badly. Lack of proper checks and balances led to the huge scam. Following this scam, several banks had taken measures to counter such practices. Banks have started stringent verification of the parties involved and are not completely relying on the SWIFT system. RBI has also taken measures to ensure that the strong control mechanisms are in place.