New Delhi, Aug 12 (IANS): Parliament Tuesday passed the Securities Laws (Amendment) Bill, 2014, to curb the menace of fraudulent investment plans, or ponzi schemes, to save investors from losing their money.
After passage by the Lok Sabha last week, the Rajya Sabha also gave its go ahead Tuesday to the bill that additionally seeks to empower the officers of the Securities and Exchange Board of India (SEBI) to conduct searches and seek data from suspected entities.
Replying to the debate on the bill, Finance Minister Arun Jaitley said the bill also provides for speedy trial of cases by setting up various courts.
He said the new bill also provided for confiscating the profits earned out of illegal activities, adding these legislative changes were required since the stock markets has transformed over the past decade or so.
"The nature of violations also changed and power of regulators too needed to be re-defined," he said.
The government brought the bill in the wake of thousands of people losing money due to these fraudulent schemes, more recently in West Bengal in what is known as the Saradha chit fund scam.
The new law empowers market watchdog SEBI to search the premises of suspect companies and get information both within and outside India.
Stressing that where there is money, there will be financial sharks, Jaitley said Prime Minister Narendra Modi will announce a financial inclusion scheme whereby two bank accounts are targeted to be opened in 7.5 crore families.
He said that when the banking channels are opened up for the un-banked population, then the need for ponzi schemes would go down.
The new scheme, he added, will lure people away from financial fraudsters.
Several members participated in the debate and said many companies in the past had just disappeared after duping investors - an issue that growth has also affected economic growth.