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March 01, 2018

PNB Scam Effect : Govt Approves Fugitive Economic Offenders Bill

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To deal with those banking fraudsters who are escaping overseas to avoid getting caught, the Union Cabinet today proved the Fugitive Economic Offenders Bill. This bill, which is likely to be brought before Parliament in the second half of the budget session beginning March 5, empowers the government to confiscate any property owned by such persons in India. The bill is aimed at deterring economic offenders like Jeweller Nirav Modi, Indian Premier League founder Lalit Modi and liquor tycoon Vijay Mallya,  from fleeing the country or not returning to face trial. This law is expected to help banks and other financial institutions achieve higher recovery from financial defaults.

Important Highights of Fugitive Economic Offenders Bill

  • A fugitive economic offender is a person against whom an arrest warrant has been issued and who has left India to avoid criminal prosecution and refuses to return.
  • This billl will help deter economic offenders from evading the law by staying outside the jurisdiction of Indian courts.
  • The property of the offender will be seized in India and abroad, including those that are proxy-owned.
  • Under the proposed law, the accused will be given a chance to state their case, which will include an appeal in the high court.
  • The government's move comes alongside an investigation into what is believed to be a Rs. 12,000 crore swindle by jewelers Nirav Modi and Mehul Choksi, who were able to get fake Punjab National Bank guarantees to enable them to score credit from banks overseas.
  • The provisions of the bill will apply for economic offenders whom an arrest warrant has been issued for a scheduled offence as well as wilful bank loan defaulters with outstanding over Rs 100 crore.
  • The economic offenders will be tried under prevention of money laundering act.

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