The Finance Ministry informed Parliament on Monday (September 15) that as many as 38 economic offenders, who defaulted on repaying banks, fled the country in a span of five years from 2015 to 2019.
The 38 wilful defaulters include known names like Vijay Mallya, Nirav Modi and Mehul Choksi.
Minister of State for Finance Anurag Thakur provided the reply in response to a query on whether the Centre has any data on businessmen including those who migrated to other countries after obtaining loans fraudulently during last 5 years.
Thakur said, “The Central Bureau of Investigation (CBI) has apprised that 38 persons involved in the cases registered by CBI related to financial irregularities with banks fled the country during 1.1.2015 to 31.12.2019.”
Thakur assured the Lower House that “action is taken as per law in such cases”.
According to the Enforcement Directorate, Red Corner notices were slapped on 20 economic offenders under the Prevention of Money Laundering Act, 2002 and extradition requests were sent out in 14 cases to several countries. Court proceedings were on against 11 people under the tough Fugitive Economic Offenders Act, 2018, Thakur told the House.
The Ministry of Finance informed the Lok Sabha that government has taken action against the offenders and introduced policy measures to prevent businessmen and individuals from fraudulently obtaining loans and then escaping the country.
Under the Fugitive Economic Offenders Act, 2018, businesses or individuals availing of bank loans of more than Rs 50 crore to submit a certified copy of the passport of promoters/directors of companies, Thakur said, adding that FIRs have been registered in 2,915 cases against wilful defaulters as per the Reserve Bank of India’s instructions. Also, the wilful defaulters are not sanctioned any additional facilities by banks or financial institutions, and their unit is debarred from floating new ventures for five years.
The Securities and Exchange Board of India (SEBI) has fully utilized the Substantial Acquisition of Shares and Takeovers (Second Amendment) Regulations, 2016, to prevent wilful defaulters from accessing capital markets to raise funds.
Nationalised banks’ data shows that Rs 7,654 crore has been recovered from wilful defaulter accounts between 2014 and 2019.