Ponzi menace: Govt to sensitise police, judiciary in states

Pilot said that it is the job of the investigating and prosecuting agencies to take the case further, once the fraud is detected

Continuing its efforts to curb fraudulent investment schemes, government will soon start a process to sensitise police, judiciary and other agencies across states on ways to contain this menace.

     
The project is being undertaken by the Corporate Affairs Ministry with an aim to reach out to the authorities present at the last mile to make them aware about the steps they can take against individuals and entities defrauding the gullible investors in the name of high return schemes.

     
Aiming to make it a nationwide initiative, Corporate Affairs Minister Sachin Pilot said he himself, as also other representatives from his Ministry and other central agencies, would hold meetings with judicial and police officers in different states.

     
"Authorities, judicial and police officers would be made aware about these issues. We are willing to go out of Delhi (to create awareness). Sitting and doing things from Delhi may not work very well," Pilot told PTI in an interview here.

     
The minister said that it is the job of the investigating and prosecuting agencies to take the case further, once the fraud is detected, and therefore it is necessary for them to be aware about the steps that needs to be taken in such cases.

   
"Once you detect the fraud and catch the culprits, to be able to have the right knowledge of the law under the Companies Act, how to prepare those charge-sheets, how to actually file and prosecute people, that is the job of the investigating agency and the prosecuting agency," he noted.

     
The Minister said that police at times might not know the sections of the law under which a case should be registered.

     
Similarly, the Registrar of Chits must know the powers that they have to check and regulate the chit funds.

     
"They should know about the data and information that they needs to check with other regulators. It is not impossible given the technology available today. The agencies just need to work together," he said.

   
 "So, I am going to go to East India, West India, state capitals and meet the state department officers, irrespective of who is running the government," Pilot said.

     
The latest initiative comes against the backdrop of rising instances of common man getting duped by various fraudulent investment schemes, including ponzi schemes where investors are promised higher returns for bringing in new people to the net.

   
After Saradha scam broke out in West Bengal earlier this year, the Centre had initiated various steps to curb such activities and protect the interest of investors.

     
Capital markets regulator Sebi has already been given greater powers to regulate all kinds of investment pools involving Rs 100 crore or more, while it has also been authorised to pass orders for attachment of properties and conduct search and seizure operations.

 

Pilot said that the Corporate Affairs Ministry would seek to create a greater connectivity with state authorities to better tackle the fraudulent investment scheme menace.

     
"Most police departments, whether it is Delhi or other places, they have an Economic Offence Wing. How they must relate to the Ministry of Corporate Affairs and Registrar of Companies with regulators should be known. There is a need for a greater connectivity between these agencies," he added.

     
The minister also stressed that he along with officials, regulators, state police and judicial officers, among others, would carry out capacity building on laws that are in place to tackle ponzi schemes.

     
Stressing that there needs to be more awareness about various laws and relevant sections to punish the guilty, Pilot said that weak cases would allow scamsters to go scot free.

     
"We find people who have done wrong but then under which section of Companies Act, CrPC, IPC... Etc. If the case is weak at the beginning, no matter how big the scamster is it will not hold in the court of law," he said.

     
"That kind of training and investor education is necessary. We will do it in the East, West and other parts of the country," he added.