When “hundreds of employees” of India’s Central Railway Department lost “thousands of rupees” after senior management recruited them into the well-known pyramid scheme TVI Express, you’d have thought the first order of business would have been an investigation into management’s involvement and appropriate action being taken.

Yet seven months after news of the scam surfaced, the only people who have lost their jobs are the victims who dared to lodge written complaints against their superiors.

Reports were based on inputs by employees and victims who are shy of filing written complaints to avoid hassles. Those employees who filed complaints were forced to withdraw by officials who were involved.

This was of course after Brijesh Dixit, Divisional Railway Manager, publicly urged ‘victims of the scam‘ to ‘come forward to complain that they were cheated‘.

Despite ringleaders being publicly identified, including Deepak Soni who ‘used his official position‘ to ‘reap maximum benefit of the scheme‘, Cental Railway Department charged with investigating the matter refused to take any action against them because they appeared to be “close” to “top officials” within the Railway Department.

The official status of the Central Railways Department investigation remains unclear…

Senior divisional personnel officer (SrDPO) BK Panigrahi said the inquiry is over and the final report has been submitted to senior divisional operating manager (SrDOM) Satyendra Kumar two weeks ago. But, Kumar has not yet received the report.

Both the officials sit in the same office building.

Funny how that works when those involved in the scam are left to investigate and hold themselves accountable…

Meanwhile on the regulatory side of things, one government agency has finally announced they are launching an investigation, but only after the Times of India pressed them on it.

In March, TOI had taken up the issue with the CVC. In reply, section officer with CVC Suneja Janardanan informed that the complaint regarding TVI scam has been duly examined and forwarded to chief vigilance officer (CVO) AK Maitra, who is also adviser to the Railway Board, for necessary action.

The CVC is India’s Central Viligance Commission,

an apex Indian governmental body created in 1964 to address governmental corruption.

It has the status of an autonomous body, free of control from any executive authority, charged with monitoring all vigilance activity under the Central Government of India, and advising various authorities in central Government organizations in planning, executing, reviewing and reforming their vigilance work.

Whether anything comes from the CVC’s investigations remains to be seen.

On a related note in the face of rampant scammery in India, with those caught able to flout the law and remain at large (the ringleaders of Nagpur’s TVI Express chapter above but one example), India’s Ministry of Finance has initiated a discussion on strengthening regulation of India’s 1.1 billion USD MLM industry (2011-2012):

The Government has constituted a High-Level Inter-Ministerial Group (IMG) for proper enforcement of regulatory framework for Multi-Level Marketing Companies, Non-Banking Finance Companies and Companies running Collective Investment Schemes, under the Chairmanship of Additional Secretary, Department of Financial Services, Ministry of Finance.

The Group consists of Joint Secretary level officers from the Department of Economic Affairs, Ministry of Finance, Department of Revenue, Ministry of Finance and Ministry of Corporate Affairs, and the Joint Secretary level officers from the Reserve Bank of India (RBI) and Securities and Exchange Board of India (SEBI).

The Group is expected to strengthen the existing coordination mechanisms for regulation and supervision of financial sector.

The First Meeting of the Inter-Ministerial Group is scheduled for May 16, 2013.

It might too late for the Railways Department TVI Express victims, but here’s hoping the MOF’s initiative brings India one step closer to a more pro-active approach to regulating their MLM industry.

The current “come to us with complaints otherwise we won’t do anything” system has clearly failed the country miserably.