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New Delhi, February 20
In order to check ponzi schemes, the government today proposed a stringent law to punish those who raise funds through unregulated deposits.
The Union Cabinet today gave its approval to introduce Banning of Unregulated Deposit Schemes Bill, 2018, in Parliament.
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“It is aimed at tackling the menace of illicit deposit-taking activities. Institutions running such schemes exploit regulatory gaps and lack of strict administrative measures to dupe poor people of hard-earned savings,” a statement said.
The Bill, it said, provides for complete prohibition of unregulated deposit-taking activity. Authorities would be set up by state governments to “ensure repayment of deposits in event of default”.
As per the release, the Bill would ban unregulated deposit-taking activities altogether by making them an offence ex-ante, rather than the existing legislative-cum-regulatory framework which only comes into effect ex-post.
The Bill proposes to create three types of offences — running of unregulated deposit schemes, fraudulent default in regulated deposit schemes, and wrongful inducement in relation to unregulated deposit schemes. — TNS/PTI
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