2G SPECTRUM SCAM
WHAT IS 2G SPECTRUM
• 2G (or 2-G) is short for second generation
wireless telephone technology.
• Phone conversations can be digitally encrypted.
• Systems are significantly more efficient on the
spectrum allowing for far greater mobile phone
penetration levels.
• 2G introduced data services for mobile, starting
with SMS text messages
SPECTRUM
• spectrum refers to the part of the electromagnetic
spectrum corresponding to radio frequencies.
• Electromagnetic waves in this frequency range,
called radio waves, are used for radio
communication and various other applications.
• So, private players use this spectrum and charge
subscription from mobile users and this way they
makes money
WHAT IS 2G SPECTRUM SCAM
• In 2008,the UPA, issued 122 new telecom
licenses to several domestic companies with
little or no experience in telecom sector, and
at a price set in 2001.
• The shortfall between the money collected
and the money which the law mandates to be
collected is 1.76 lakh crore rupees.
BACKGROUNG
• India is divided into 22 telecom zones, with
281 zonal licenses in the market. In 2008, 122
new second generation (2G)Unified Access
Service (UAS) licenses were given to telecom
companies at the 2001 price and on a
firstcome-first-serve basis.
INVESTIGATION AGIENCIES
CBI INVESTIGATION
• on 2 April 2011 by the investigating agency, Central
Bureau of Investigation (CBI), the loss was pegged at
INR309845.5 million (US$5.1 billion).
• on 19 August 2011 in a reply to CBI, Telecom
Regulatory Authority of India (TRAI) said that the
government gained over INR30 billion (US$490
million)
Kapil Sibal, the Minister of Communications & IT, claimed in 2011,
during a press conference, that "zero loss" was caused by distributing
2G licenses on first-come-first-served basis.
CAG REPORT
• Licenses were issued to firms with no prior experience in the
telecom sector
• Spectrum scam has cost the government Rs. 1.76 lakh crore
• Rules and procedures flouted while issuing licenses
PARTIES INVOLVED IN THE SCAM
• A Raja. Former Union Cabinet Minister
(Communication and Information Technology – 2007
& 2009).
• Criminal breach of trust by a public servant under
section 409, criminal conspiracy under section 120-B,
cheating under section 420 & forgery under sections
468 and 471. Booked under the Prevention of
Corruption Act for accepting illegal gratification
M. K. Kanimozhi
Daughter of five-time Chief Minister of Tamil
Nadu, M. Karunanidhi. Political party DMK.
She is a member of parliament, representing
Tamil Nadu in the Rajya Sabha (the upper
house of Indian Parliament).
BUREAUCRATS
• Siddharth Behura Telecom Secretary when
licenses were granted.
• RK Chandolia Raja's private secretary when
licenses were granted
CORPORATION EXEUTIVES
• Sanjay Chandra Former MD, Unitech Wireless
• Gautam Doshi Group MD, Reliance Anil Dhirubhai
Ambani Group
• Hari Nair Senior vice-president, Reliance Anil
Dhirubhai Ambani Group
• Surendra Pipara Senior vice- President, Reliance Anil
Dhirubhai Ambani Group.
• Vinod Goenka Promoter and managing director, DB
Realty & Swan Telecom
• Shahid Balwa Promoter, DB Realty & Swan Telecom
CORPORATION
• Unitech Wireless
• Reliance Telecom
• Swan Telecom
• Loop Telecom Pvt Ltd
• Loop Mobile India Ltd
• Essar Tele Holding
• Essar (Parent group of Essar Tele Holding)
MEDIA PERSONS AND LOBBYISTS INVOLVED
• 1.Nira Radia : A former airline entrepreneur turned
corporate lobbyist whose conversations with
politicians & corporate entities were recorded by govt
authorities & leaked.
• 2. .Barkha Dutta : An NDTV journalist alleged to have
lobbied for A. Raja's appointment as minister.
• 3.Vir Sangavi : A Hindustan Times editor alleged to
have edited articles to reduce blame in the Nira Radia
tapes.
(JPC)Joint Parliamentary Committee
• What is JPC?
• JPCi s appointed to inquire into particular matter which is
important for the nation tis formed when motion is adopted
by one house and it is supported or agreed by the other
house.
• How many persons can be members of JPC?
• The rule is simple -
The Lok Sabha members are double compared to Rajya Sabha.
When the JPC was established?
• JPC was instituted to inquire into the
• 1.Bofors contract
• 2.Harshad Mehta scandal.
• 3.Stock Market Scam.
• 4. Pesticide residues in soft drinks
What are the powers of JPC?
• 1.It can collect oral or written evidence from the experts.
2.The proceedings of parliamentary committees are confidential.
• 3.Normally ministers are not called to give evidence.
4.It can inspect all documents related with the inquiry.
5.It can send summons to people to appear before them, if person
does not obey summons it is considered as contempt of House.
6.The Speaker has the final word on any dispute over calling for
evidence
JPC(Contd…)
• Why is the opposition demanding a JPC probe
into the 2G spectrum scam?
• Why is the Congress using all its firepower to
resist a JPC probe?
Latest developments BY JPC
• A raja could have got bribes to the tune of 3000 crs as per CBI
& Enforcement Direcotrate.
• Arrest of Shahid Balwa by theCBI.
• Shourie to appear before CBI on Feb 21.
• The new licencees got huge foreign investments. One of them
brought in share capital worth S$625 million.
• The licencees attracted investments in US, Japanese, and
Mauritian currency.
• CBI accused Public sector Bank including SBI of stepping out
of internal rules to advance Rs.11000crore on the basis of
irregularly alloted 2g spectrum.
• Govt may agree on JPC.
Worlds second largest abust to economy
1.76 lakh crores
SEASON OF SCAMS
THE FIGHT AGAINST CORRUPTION
Role of CA
• CAs create strong governance through
supervision.
• CAs discourages managers from falsifying
financial statements and at the same time,
checking on the internal control system,
• Scrutinize the efficiency of management viz;
through Forensic auditing, CARO reporting etc.
THANK YOU
