Prime Minister Narendra Modi (File photo)
Prime Minister Narendra Modi (File photo)

Cabinet approves amendments to Banning of Unregulated Deposit Schemes Bill

ANI | Updated: Feb 06, 2019 23:06 IST

New Delhi [India], Feb 6 (ANI): The Union Cabinet on Wednesday gave its approval to move official amendments to the Banning of Unregulated Deposit Schemes Bill, 2018, pursuant to the recommendations of the Standing Committee on Finance (SCF).
The banning of Unregulated Deposit Schemes Bill, 2018 was introduced in Parliament on July 18, 2018, and was referred to the SCF, which submitted its 70th report on the said Bill in Parliament on January 3, 2019.
The official amendments will further strengthen the Bill in its objective to effectively tackle the menace of illicit deposit-taking activities in the country, and prevent such schemes from duping poor and gullible people. 
The Bill contains a substantive banning clause which bans deposit takers from promoting, operating, issuing advertisements or accepting deposits in any Unregulated Deposit Scheme. The principle is that 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 with considerable time lags.
The Bill creates three different types of offences - running of Unregulated Deposit Schemes, fraudulent default in Regulated Deposit Schemes, and wrongful inducement in relation to Unregulated Deposit Schemes. It provides for severe punishment and heavy pecuniary fines to act as a deterrent. (ANI)