In its endeavour to crack down on economic fugitives and attach their properties, the Union Cabinet on Saturday approved a proposal to annunciate Fugitive Economic Offenders Ordinance 2018, sources said. The ordinance seeks to confiscate properties of economic offenders, like Nirav Modi, who flee the country to avoid facing criminal prosecution.
The need for the Ordinance has arisen as there have been instances of economic offenders fleeing the jurisdiction of Indian courts, anticipating the commencement, or during the pendency, of criminal proceedings. The law is aimed at quickly recovering losses to exchequer or public sector banks in cases of frauds like the alleged USD 2 billion fraud by fugitive jeweller Nirav Modi.
With this Ordinance, corporate fugitives would be forced to return to India to face trial for scheduled offences. This would also help the banks and other financial institutions to achieve higher recovery from financial defaults committed by such offenders, improving the financial health of such institutions.
The provisions made under the Fugitive Economic Offenders Ordinance are:
1. Making an application before the Special Court for a declaration that an individual is a fugitive economic offender.
2. Attachment of the property of a fugitive economic offender and proceeds of crime.
3. The issue of a notice by the Special Court to the individual alleged to be a fugitive economic offender.
4. Confiscation of the property of an individual declared as a fugitive economic offender or even the proceeds of crime.
5. Disentitlement of the fugitive economic offender from defending any civil claim.
6. Appointment of an administrator to manage and dispose of the confiscated.
The Fugitive Economic Offenders Bill, 2018 was introduced in the Lok Sabha on March 12 but couldn’t be taken up due to the logjam in Parliament over different issues. With Parliament being adjourned sine die, an ordinance was proposed. The Union Cabinet yesterday approved the ordinance and the President today gave his assent to the promulgation of the same.
The statements reveal that “A Fugitive Economic Offender is a person against whom an arrest warrant has been issued in respect of a scheduled offence and who has left India so as to avoid criminal prosecution, or being abroad, refuses to return to India to face criminal prosecution.” However, only cases of frauds, cheque dishonour or loan default of over Rs 200 crore would come under this Ordinance.
This initiative taken by the government to curb economic offenders like bank fraudsters or loan defaulters comes as a revolutionary step aimed at deterring offenders from evading the process of law.