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Corporate Frauds - PIB

Saturday, July 26, 2014 Posted by Unknown No comments
During the last three years (and this year up to 30-06-2014) the Ministry has ordered investigation into the affairs of 152 companies allegedly indulging in fraudulent/illegal activities. Of these, 64 investigations have been completed and reports submitted to the Ministry while in 2 cases, investigations have been stayed by the Courts. In respect of completed investigations, Ministry has ordered filing of prosecutions against companies/ directors/ officers in default on account of various non-compliances/ offences committed under the Companies Act, 1956 and other Statutes, as recommended in the investigation reports. Steps taken by the Ministry include:

(i) Setting up a Market Research and Analysis Unit (MRAU) in the Serious Fraud Investigation Office (SFIO) with the objectives of analyzing media reports relating to financial frauds and for conducting market surveillance of such corporates.

(ii) A forensic lab with appropriate technology and skilled technical manpower has also been set up in the SFIO as part of MRAU.

(iii) An ‘Early Warning System’ is being developed that would generate alerts for analysis and early detection of potential frauds. A pilot testing was carried out during the year 2013-14.

This was stated by the Minister of Corporate Affairs, Shri Arun Jaitley in a written reply to a question in Lok Sabha today.

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