Stressing that banks and auditors need to be more alert in detecting frauds, Union Finance Minister Arun Jaitley on Saturday said bank scams “push ease of doing business to background” while scarring the economy.

Speaking at the Global Business Summit in the national capital, Jaitley said politicians alone should not be held accountable for scams such as the Rs.11,300 crore Punjab National Bank (PNB) scam, one of the biggest in India’s banking history.

“If a fraud is taking place in multiple branches of banking system and no one raises a red flag, it is worrisome for the country,” Jaitley said.

“Regulators decide the rules of the game and they have to have a third eye which perpetually be open. Unfortunately, in the Indian system we politicians are accountable but regulators are not,” he added.

He further said that cases of willful default and bank fraud hurt the economy and ease of doing business.

“Bank frauds push ease of doing business to background while scars on economy take front seat,” he said.

On February 14, state-owned PNB disclosed that it had unearthed fraudulent transactions worth Rs.11,400 crore at one its Brady House branch in Mumbai.

In a complaint to the Central Bureau of Investigation, the lender named firms and people associated with billionaire jeweller Nirav Modi to connived with some of its officials to defraud the bank using bank guarantees.

The fraud, which includes money-laundering among others, concerns the Firestar Diamonds group in which the CBI has booked Modi, his wife Ami, brother Nishal Modi and their uncle Mehul Choksi.