MLM or Ponzi Schemes: CBI, ED & SFIO Registered 196 Cases in Past 3 Years: Govt
Moneylife Digital Team 08 August 2022
During the past three years, enforcement agencies working under the Union government have registered 196 cases involving 219 companies, the Lok Sabha was informed. 
In a written reply, the minister of state for finance revealed, the government and enforcement agencies have taken action against those running unauthorised schemes. "Central Bureau of Investigation (CBI) has registered 100 cases relating to Ponzi schemes during the years 2019 up to 30 June 2022, involving 132 companies and firms and arrested 21 persons in this regard."
"The Directorate of Enforcement (ED) has investigated 87 cases related to Ponzi schemes under the provisions of the Prevention of Money Laundering Act, 2002 (PMLA) during the last three years and the current year. Eight persons have been arrested by ED in this regard," the minister says.
Further, during the past three years, the ministry of corporate affairs (MCA) asked serious fraud investigation Office (SFIO) to investigate the affairs of nine cases involving 85 companies which were allegedly engaged in fraudulent chit funds, multi-level marketing (MLM) and  Ponzi activities. No arrest has been made in this regard by SFIO.
According to the minister, the Sachet portal of the Reserve Bank of India (RBI), which is the online platform for state-level coordination committees (SLCC) and facilitates the public to lodge complaints of financial frauds, received 1,540 complaints related to non-repayment of deposits and money collected for various kinds of investment schemes, including 964 in 2020-21 and 576 in 2021-22. 
During the past four years, the Securities and Exchange Board of India (SEBI) has passed final orders against 29 unregistered entities that were running collective investment schemes (CIS), the minister added.
To tackle the menace of illicit deposit-taking schemes, which dupe people of their hard-earned savings and protect their interests, the Union government has enacted the Banning of Unregulated Deposit Schemes Act, 2019. The Act contains comprehensive provisions prohibiting promoting, operating, issuing advertisements or accepting deposits in any unregulated deposit scheme and provisions for severe punishment and heavy pecuniary fines to act as a deterrent. 
Further, 29 states and Union Territories (UTs) have passed Protection of Interest of Depositors (PID) Acts for taking action against entities collecting money from the public illegally, the minister says.
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