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The government’s task force has arrived at a formula to define a ‘shell company’, a move critical for enforcement agencies to crack down on dubious entities exploiting the regulatory framework.
According to sources, the task force has listed 18 key parameters, including beneficial ownership and the nature of business dealings, to determine if a company has been created to launder money or exploit regulatory arbitrage.
A company that lacks beneficial ownership, is inconsistent in big-ticket transactions, or is one that does repetitive transactions with no apparent business purpose could be tagged a ‘shell company’.
Further, any company that transfers large sums to a
