THE CPI(M) Polit Bureau member Sitaram Yechury has demanded that the allegations against the PMO's involvement in the UTI scam must also be investigated by the Joint Parliamentary Committee (JPC). For this if needed the terms of reference should be changed, he said.

Addressing a press conference at the party head quarters AKG Bhavan on August 5 he reiterated the CPI(M)'s demand that the finance minister should quit immediately owning responsibility for the gigantic fraud perpetrated on millions of small investors. There was a merciless loot affecting over two million Indian people nearly to the tune of Rs 6000 crore. The manner in which this has happened displays the worst type of crony capitalism stated Yechuri.

This crisis is not confined only to UTI's US-64 scheme alone. The crisis has engulfed many financial institutions (FIs) like IDBI, IFCI, LIC, GIC and banks like Madhavpura Mercantile Cooperative Bank. He warned that this is symptomatic of a much larger malaise and the repercussions would continue to surface.

He said that it was sad that since the process of liberalisation began, two major stock market scams took place wiping out market capitalisation worth lakhs of crores of rupees. Large sums of the country’s money has been looted by scamsters and with the full knowledge of the finance minister and the officials of the ministry. Saying that these scams indicated the total collapse of the financial system, he called for revamping entire system to stop this gigantic loot of Indian people's money.

Presently this loot is being done in three ways, he explained. One was directly by the false companies, which after moping up funds from the stock market are doing a vanishing act. He quoted the SEBI report released last week which stated that 209 companies just did not exist and yet raised crores of rupees from investors.

Second manner was the unholy nexus between the officials of public financial institutions, scamsters and ruling party bosses. The third way was the Mauritius route due to which the nation lost Rs. 3, 000 crores in non payment of capital gains tax.

Sitaram Yechuri demanded an enquiry to be conducted into the manner in which unscrupulous politicians, bureaucrats and businessmen manipulated the system. This is necessary not only to bring the guilty to book but also to cleanse the system and set in place mechanisms to prevent any such occurrence in future, he said.

Making a scathing attack on the finance minister, Yechury said that in his first stint as finance minister, Yashwant Sinha had mortgaged the country's gold reserves and now in his second stint he is bent on mortgaging the country itself. The finance minister's statement that the low redemption of UTI bonds indicated the trust still being reposed by the investors, was outrightly ridiculous, Yechury felt.

He highlighted the link of 'Mauritius route' to the present scam saying there was clear evidence to show that stock broker Ketan Parekh had used certain overseas corporate bodies (OCB's) - Brentfield Holding, Kensington Investments, Wakefield Holdings, European Investments, Far East Investments located in Mauritius - to siphon around Rs 3,000 crore out of the country. He reminded that it was at the instance of the finance minister that the Mauritius route was kept open even though the Income tax authorities had given notice to many foreign institutional investors (FIIs) for using this route fraudulently to avoid paying taxes in India.