New Delhi, Jul 10 (IANS): Seeking to curb the menace of ponzi schemes, the Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday gave its approval to the Banning of Unregulated Deposit Schemes Bill, 2019.

The proposed law would address the issue of illicit deposit-taking activities, as it provides for strict action against such activities.

"The Bill will help tackle the menace of illicit deposit-taking activities in the country which, at present, are exploiting regulatory gaps and lack of strict administrative measures to dupe poor and gullible people of their hard-earned savings," an official statement said after the Cabinet meeting.

The new Bill will replace the Ordinance promulgated in February this year which will otherwise cease to operate after six weeks of re-assembling of the Parliament.

The draft law has been brought in the wake of alleged duping of lakhs of financially illiterate people by Saradha and Rose Valley chit funds in West Bengal, Odisha and other states. Investigating agency CBI has filed several cases in the alleged scam.