Rbi Readies A New Scambuster

The Reserve Bank of India is setting up an agency to specifically investigate scams in the financial sector.

An RBI-constituted panel, headed by legal advisor to the central bank NL Mitra, at its last meeting held on Saturday in Mumbai gave the final touches to the concept of the Directorate for Financial Frauds Investigations.

Modelled on the lines of the Serious Frauds Office (SCO) in the UK and the Financial Institu- tions Crime and Enforcement Network of the US, the directorate will be a multi-disciplinary investigating agency accountable to Parliament.

The report of the committee along with a draft Bill for the proposed Financial Frauds Act will be submitted to the Reserve Bank of India and the finance ministry by July 30.

 

It is planning to peg the cut-off amount (for any scam to be referred to this body) at Rs 100 crore. The SCO in the UK handles fraud cases involving pound sterling 1 million while the major frauds wing in the US takes up cases involving $10 million and more.