 |
| Money Laundering |
Government has recently declared Vijay Mallya as a fugitive economic offender. Fugitive economic offenders act was the need of the hour.
Who is a fugitive economic offender?
One against whom a non-bailable arrest warrant is issued and the quantum of fraud committed by him is 100 crores or above.
Historically many fugitives have evaded the country's existing laws and have fled the country to escape the criminal prosecution in India.
Current data shows there as many as 31 wilful defaulters hiding in foreign countries. Some even have become citizens of other countries.
At a time when Indian farmers are committing suicide for not able to repay the bank loan, these businessmen are living a luxurious life in foreign countries even defaulting loans of a thousand crores. So it has become very necessary for the current government to bring such an act.
Salient features of this Act:
1. This act talks to confiscate all the properties of a fugitive economic offender by a special authority appointed by the Government.
2. This act talks to establish a special court before which an investigating agency can make an appeal to confiscate the property.
3. The special court gives 6 weeks time to the person to present his case before the court.
4. If the person fails to do so, the court can declare him/her as a fugitive economic offender. But the quantum of economic offence must be 100 crores or above.
5. The confiscated property will go to the Government of India.
Why do we need such an act?
1. Because the existing laws are not able to prosecute the economic offenders who have fled the country and outside the jurisdiction of India.
2. To establish the rule of law, it is necessary in a democracy like ours to punish a person whoever commits an offence.
3. To restore the stressed banking sector. Both public and private banking sectors are reeling under high amount of NPAs created due to these types of wilful defaulters.
Concerns with this act:
1. The act calls for a criminal prosecution against the person whereas the committed offence of money laundering is a civil one.
2. This act debars the person from filing any civil suit in any case in any court of law thereby depriving him/her from his/her right to get justice which is a clear violation of the Constitution.
3. This law has provisions for confiscating the properties within India.What will happen if a person has all his properties outside the jurisdiction of India.
4. There are many provisions in this law which will not stand against many international laws thereby stopping the path for his extradition from a foreign country.
5. If the person fails to present him/her before the special court within 6 weeks, He/She will be declared as a fugitive economic offender. So declaring a person as an offender without any trial in the court of law is a clear violation of natural justice system.
6. The quantum of offence has been decided as 100 crores what about other persons who have defaulted less than 100 crores.
7. The Government will take over all the confiscated properties of the offender. But what about the promoters who have invested their money in that company. How will they get their due?
8. There is no provision for individuals or employees to lay their claims before the special court.
9. The special court would need many experts in the field of money laundering to function well. But there is no provision for capacity building.
What is the way forward?
The Government has not addressed the root causes of money laundering and absconding rather has tried to get some short term goals.
How can so many banks give such a big amount of money to a person without having any collateral?
How can a person flee the country while our enforcement agencies have issued lookout notice against him?
The real solution lies in making the procedure involved while issuing credits to become more stringent and transparent and making our law enforcement agencies more efficient.
We have so many beautiful laws in our country like prevention of money laundering act, custom act, prevention of counterfeiting of currency act, etc. So the problem lies in the implementation of the law in its letter and spirit.
Currently, India has agreements with just 39 countries for confiscation of properties of fugitives in their respective countries. India should expedite the process in signing such agreements with more and more countries.
0 Comments