Of course it is. There is no way a scam on this level could've happened if the entire system, i.e. the government was also not involved in it.What is Govt mistake in it when people are dumb enough to handover money to agents and don't even check by visiting post office. Law are here to protect us but if we keep our safe open and someone loots, what law can do.
Stupidity has a cost to pay and this was sheer stupidity by 70 people who never cared to check their accounts or FDs,
In India the system is so corrupt that it is the government, that is the sovereign itself, that is doing the looting most of the time..