Twelve years after it was fraudulently implanted into government by Prime Minister Manmohan Singh, Public Health Foundation of India (PHFI) continues to engage in corruption, fraud and criminality to fulfill its illegitimate objectives and to cover its tracks.
I received a call in November 2017 from someone – let’s call her/him Source One – who worked for PHFI at a senior position for a long time until she/he had had enough of the skulduggery that she/he witnessed there and resigned.
Source One told me there has been a scam amounting to more than Rs 100 crore in PHFI, wiping out the entire government contribution of Rs 65 crore to the ‘initial fund corpus’, which has been suppressed by president K. Srinath Reddy and his henchmen.
PHFI has redacted its publicly available reports in order to hide the swindle which took place through collusion between scamsters within PHFI and those claiming to represent Dena Bank and Oriental Bank of Commerce (OBC), Source One said.
No media organisation has written or shown anything that will name PHFI in connection with the scam which is being investigated by the CBI. Not a word.
Head-Finance Amit Chaturvedi, who is directly answerable for the stolen funds, continues to be on the payroll of PHFI while propriety demands he should have been the first to quit or be asked to step down, Source One said.
“Absolutely no one in PHFI has been held to account for the massive fraud even though, as far as I can understand, there is criminal culpability of the people on whose watch the funds were siphoned off – including that of Srinath Reddy.”
Source One said the swindle and the cover-up took place during the chairmanship of N.R. Narayana Murthy – who has since Jan. 2015 been enjoying his second stint as the chair of the corrupt private club, the first being July 2011-Oct. 2013 – showing what hypocrisy the Infosys man embodies in projecting himself as an advocate of high standards of "corporate governance".
Bill and Melinda Gates Foundation (BMGF) – which led the gang of capitalist racketeers in setting up PHFI (which should most appropriately stand for 'Public Health Fraud of India') in 2006 – has washed its hands off the whole episode and government representatives on the PHFI board have predictably been supine.
Plots of land acquired in states for setting up public health schools haven't been built upon, which is another big scam, Source One said.
“All the bungling and mismanagement has caused a haemorrhage of workers, shrinking PHFI from a 1000-plus organisation to about half that strength.”
Meanwhile, K. Srinath Reddy, the criminal-minded president of PHFI who, in August 2012, forged a document (purportedly a copy of the signed and stamped document setting out the composition of PHFI governing body as on 31 March 2006.) and had it sent to me under the Right to Information (RTI) Act, continues to enrich himself, drawing a pay package of about Rs one crore per annum.
(Reddy the crook has indeed come a long way since the time he worked as a cardiologist at New Delhi's All India Institute of Medical Sciences or AIIMS on a modest salary.
While working at AIIMS-New Delhi, he wangled himself a wholly illegal “deputation” to PHFI, the impostors’ club that he himself helped to register as society along with Rajat Gupta of McKinsey and six other wheeler-dealers and hirelings.
His is thus a Jeffery Archeresque tale of how a humble but scoundrelly public official helped carve a parasitical private empire inside government and manoeuvred himself into the position of its fabulously-paid steward.
Reddy pulled that off by hitching his wagon to a ‘star’ which in his case was Rajat Gupta, the suave henchman in India of American corporate interests and a favourite crony of Prime Minister Manmohan Singh’s.
Gupta became the founding chairman of PHFI and made Reddy the chief executive, but had to give up his position after falling foul of the law in the US.
Gupta was found to be involved in the Galleon insider trading ring; he was later to be prosecuted for and convicted of securities fraud in that case and jailed for two years.)
Source One told me that the aforementioned swindle took place when PHFI dealt with middlemen of Dena Bank and Oriental Bank of Commerce (OBC) in transferring money into fixed deposits (FDs).
“Fake FD receipts were issued to PHFI and the money was diverted to the third parties.”
The media reported in August 2014 that “the finance ministry has ordered a forensic audit of Dena Bank and OBC after some of their Mumbai-based branches allegedly misappropriated funds worth Rs 437 crore, mobilised through fixed deposits”.
“The Central Bureau of Investigation (CBI) is already looking into the alleged fraud,” said a report by the Hindu-Business Line.
The media gave wide coverage in 2017 to the home ministry’s revoking of PHFI’s licence to receive foreign funds without saying anything about money swindled through FDs at Dena Bank and OBC.
PHFI’s licence to receive foreign funds was revoked, according to media reports, on account of a number of "undesirable activities", including failure to declare over 100 FDs and “having more than one PAN (permanent account number) for opening accounts and FDs” in violation of the law.
I checked on PHFI’s website its annual reports (two of which, for the years 2012-13 and 2013-14, are available) and found large portions blurred and rendered unreadable.
These portions contain information such as sources of funds, application of funds and bank deposits.
It’s notable that despite allowing PHFI to scrounge off public assets worth hundreds of crores, the government continues not to force this racket to submit itself to audit by Comptroller and Auditor General of India (CAG).
Ensnaring Sree Chitra Tirunal Institute
Continuing with its criminal ways, PHFI manipulated Sree Chitra Tirunal Institute for Medical Sciences and Technology (SCTIMST) at Trivandrum into wrongly recognizing the former’s dubious ‘Master of Public Health’ (MPH) and PhD programmes.
The SCTIMST has been recognized by the central government as a university and an institute of national importance.
“An entirely corrupt and unlawful arrangement was reached after SCTIMST’s academic committee and governing body repeatedly refused PHFI’s request for affiliation, citing serious problems,” said another source – let’s call her/him Source Two – who contacted me this month (February 2018).
The change of direction came about with new SCTIMST director Asha Kishore taking office on 15 July 2015.
“She brings the matter again in the academic committee (on 31 Oct. 2015) on the basis of a letter (dated 05 Oct. 2015) from PHFI’s Srinath Reddy re-seeking “strategic partnership” and a discreetly encouraging email from Secretary of the Department of Science and Technology (DST),” said Source Two who has long worked for SCTIMST.
(Making a pitch for recognition of PHFI’s courses by DST Secretary Ashutosh Sharma is another illustration of how the impostors’ club has honeycombed the government, so that it’s hard to say who a babu works for.
In addition to being the top bureaucrat at DST, which happens to be the department supervising SCTIMST, Sharma also sits on PHFI’s general body!
No point looking for conflict of interest here! Rather appreciate the sublime convenience of imposture, like the numinosity of a many-faced god!)
“The matter was smuggled into the academic committee as an out of agenda item without a word of justification. So Asha Kishore managed to circumvent the requirement to circulate an item at least seven days before the meeting,” said Source Two.
“The SCTIMST’s academic committee then accepts PHFI’s request on the basis of falsehoods that are uttered in the meeting, such as the statement that ‘PHFI is already partner for some of SCTIMST’s projects’. I drew a blank when I asked SCTIMST for documents that would support that statement,” Source Two said.
Subsequently, the SCTIMST governing body (chaired by former Union Cabinet Secretary K.M. Chandrasekhar), which had earlier taken on board serious problems in affiliating PHFI, accepts the recommendation without discussion and with a single, clumsily scribbled sentence that neither cites the course title nor names the PHFI institute to be granted the favour.
“It’s transparent that the match was fixed,” said Source Two.
“Srinath Reddy’s letter says he spoke with K.R. Thankappan, who headed SCTIMST’s public health school and favoured the affiliation. Asha Kishore tables a ‘note’ from Thankappan supporting affiliation and allows V. Ramankutty (of the same school) to make false statements like ‘PHFI is already partner for some of SCTIMST’s projects’.”
The inclusion of PhD programme in the arrangement that SCTIMST and PHFI entered into on 28 December 2015 is no less than daylight robbery, considering that PhD was not only not discussed in the academic committee meeting, it was not even mentioned in the letter that Srinath Reddy the crook wrote on 05 October 2015 to SCTIMST director Asha Kishore.
That’s not all.
The SCTIMST accommodated PHFI by changing eligibility conditions for MPH, allowing engineering, management and law graduates also to apply for the course.
(This change was also effected quite dubiously. While there is an SCTIMST notification of 02 Sep. 2016, citing a decision made by the academic committee and endorsed by the governing body, which adds engineering graduates to the candidates eligible to be admitted to MPH, there is nothing in the public domain that accounts for the inclusion of management and law graduates.)
Earlier, the SCTIMST allowed into its MPH course people with qualifications in medicine and allied sciences, or at most those holding post graduate degrees in social sciences or nutrition.
In fact, a Gazette of India notification of 22 Dec. 2011 deems SCTIMST’s MPH to be a “medical degree awarded to those persons holding recognized medical qualifications under the Medical Council of India Act, 1956”.
So the change made to accommodate PHFI goes against this gazette notification.
“It’s clear that change in eligibility conditions was made to help PHFI bag candidates and make money. PHFI has also been allowed a much greater intake of students and to charge much higher tuition fees,” Source Two told me.
While SCTIMST admits 25 students in its MPH course, PHFI has been allowed to admit 50; as against the former charging tuition fee of Rs 1.10 lakh for whole of the two year course the latter has been allowed to charge Rs 1.80 lakh per year.
After entering the arrangement with PHFI on 28 December 2015, the SCTIMST also relaxed the maximum period in which a student can complete the MPH course from two to three years (and to four years in ‘extraordinary circumstances’ with director’s approval).
There are more signs of a fixed match, such as PHFI’s citing of engineering graduates (as also management and law graduates) among those who are eligible to apply for the MPH course, in a press release issued on 29 January 2016 – long before SCTIMST’s academic committee took a decision to that effect.
The SCTIMST academic committee took a decision to add engineering graduates to the candidates eligible to take the MPH course only on 05 April 2016 (with the governing body endorsing it in July 2016 and the institute notifying the decision in September 2016).
“A complaint against the PHFI-SCTIMST deal was filed in Sep. 2017 with the Lokayukta-Kerala (case No. C/1009/2017) and another complaint has been sent to the CBI. The Kochi branch of the CBI has already been conducting a preliminary inquiry into this matter,” Source Two told me.
That PHFI is a parasitical body created and propped up by suborning government and misappropriating public money is illustrated by a letter dated 10 Jan. 2017 that PHFI’s Sanjay Zodpey wrote to the mission director of National Health Mission-Madhya Pradesh, begging for “few candidates” to be nominated for the MPH course – which won’t be worth anything without a government institute like SCTIMST legitimizing it.
So the impostors’ club faking private-sector competence and efficiency appropriates government’s resources and then begs the same government for being allowed to provide a paid service to the government!
That’s how Manmohan Singh's Public Health Fraud of India (PHFI) has been playing out for the last 12 years!
A law unto itself
To have a perspective on the two scams described above, bear in mind that PHFI was designed as a scheme that would allow its beneficiaries to enjoy power and privilege without any public accountability, as I explained earlier in my articles here, here (four-part series), here, and here.
It is accountable to no one except fraudsters like Bill Gates, N.R. Narayana Murthy and Harpal Singh (of Fortis Healthcare) who use it as a convenient handle on governments in the centre and the states to promote their private interests.
I had shown in my articles that PHFI is neither a ‘public-private partnership (PPP)’ in any formal meaning that the government attaches to that descriptor nor an ‘autonomous body’ under any ministry (nor any recognized hybrid of a ‘PPP’ and an ‘autonomous body’), as the Manmohan Singh government falsely and repeatedly claimed and as this impostors’ club continues to suggest even today.
It’s no surprise that there is no one to take responsibility for the actions of PHFI. Nor is there anyone who will ensure that it faces the consequences of its actions.
So PHFI has been a law unto itself. Over 12 years of its existence, it has been perverting with impunity the norms and processes of the central and state governments and public and private entities that it entraps in corrupt deals.
I believe rackets like PHFI came out of some kind of ‘elite consensus’ or ‘elite connivance’ in India, which means all those in power, whichever political party they belong to, are together in it, even though their stakes may vary --- be it Manmohan Singh of Congress or Narendra Modi of BJP or Naveen Patnaik of Biju Janata Dal (BJD), or even the so called ‘Left’ which has had no problem with it.
So Prime Minister Manmohan Singh “launched”, public-funded, and legitimized this fraud in 2006.
His party colleague Chief Minister Y.S. Rajasekhara Reddy gave PHFI land for setting up its ‘public health school’ in Andhra Pradesh, as did Chief Minister Narendra Modi in Gujarat, and Chief Minister Naveen Patnaik in Odisha.
It has been reported that Gujarat government (post-Narendra Modi) also legislated PHFI’s public health school in Gandhinagar into acquiring ‘university’ status.
While I investigated PHFI back in 2012, I had also learnt that the close family of a Biju Janata Dal (BJD) politician, who has long been the most prominent face of his party in Delhi, might have benefited from setting up PHFI’s public health school in Bhubaneswar – in the land deal, as far as I can remember.
(I understand that this politician's wife is the managing director of a company in which Rajat Gupta’s private equity firm New Silk Route Partners had invested.)
The ‘elite consensus’ has meant that the entire ‘establishment’ (by which I mean people with power – executive, legislative, judicial and media) has ignored this elephant in the room.
It also helps explain why government led by Narendra Modi has not shut down the racket that his predecessor Manmohan Singh set up.
PHFI case also shows that mass ‘media’ organizations are nothing but constituents of a glorified PR/propaganda system, affecting stupid ‘ideologies’ and showing pernicious selectivity in purveying news and commentary.
A self-professed ‘journalism-of-courage’ rag like the Indian Express, for example, has reported about PHFI right from 2006, helping this entity acquire legitimacy, but never asked the basic question: If PHFI claims that it’s a ‘public-private partnership’ (or ‘public-private initiative’) then who is the public authority and who are the private parties in this relationship and where is the agreement that they signed between themselves?
Has anyone seen that agreement? What is written in it? What is its scope and duration? What are the things that the parties to it are supposed to do? And who is responsible for ensuring that the parties adhere to the agreement?
It’s funny to see that in reporting on revocation of PHFI’s FCRA licence, the Indian Express and other rags portrayed PHFI as an “NGO” being victimized by the Narendra Modi government – (presumably in order to feed their favoured narrative that this government has engendered a riot of “right wing” fascism in the country) – but refrained from digging into the alleged hiding of over 100 fixed deposits by PHFI.
A number of people may be liable for the Public Health Fraud of India (PHFI), but I believe if ever the process of accountability starts, four individuals who must first be prosecuted for setting up this racket, in that order, are: Manmohan Singh, Rajat Gupta, K. Srinath Reddy, and Bill Gates.
The following Web links have been used in this post in their order of occurrence.