Day 55 – Q 5.Which agencies are responsible to detect and investigate financial frauds of serious nature? Discuss their constitution and mandate.

5. Which agencies are responsible to detect and investigate financial frauds of serious nature? Discuss their constitution and mandate.  

गंभीर प्रकृति की वित्तीय धोखाधड़ी का पता लगाने और जांच करने के लिए कौन सी एजेंसियां जिम्मेदार हैं? उनके संविधान और जनादेश पर चर्चा करें।

Introduction:

Misappropriation of funds, employee theft and embezzlement, ponzi schemes, payoffs and kickbacks, credit and debit card fraud, card skimming, investment schemes, mortgage and lending fraud, fake charity donations, internet fraud, consumer scams are some of the few financial frauds.

Body

Agencies responsible to detect and investigate financial frauds:

• The Society for Worldwide Interbank Financial Telecommunication (SWIFT): It provides a network that enables financial institutions worldwide to send and receive information about financial transactions in a secure, standardized and reliable environment.
• Financial Action Task Force:  to develop policies to combat money laundering and curb terrorism financing.
• Interpol: Its broad mandate covers virtually every kind of crime, including crimes against humanity, child pornography, drug trafficking and production, political corruption, copyright infringement, and white-collar crime. 

Agencies responsible to detect and investigate financial frauds in India:

• Reserve bank of India: banking fraud and mismatch in banking accounts are considered and investigated.
• Securities and exchanges board if India: Regulator Sebi has sought powers to conduct inspection of books of accounts of listed companies for contravention of any securities law and also to take direct action against the fraudsters. Sebi has proposed a heavy penalty for altering, destroying, mutilating, concealing or falsifying records and documents or other tangible objects with intent to obstruct, impede or influence a legal investigation.
• Financial intelligence unit: FIU-IND is the central national agency of India responsible for receiving, processing, analyzing and disseminating information relating to suspect financial transactions.
• Serious Fraud Investigation Office: The Government in the backdrop of major failure of non-banking financial institutions, phenomenon of vanishing companies, plantation companies and the recent stock market scam had decided to set up Serious Fraud Investigation Office (SFIO), a multi-disciplinary organization to investigate corporate frauds.
• Directorate of Enforcement (ED): It is a law enforcement agency and economic intelligence agency responsible for enforcing economic laws and fighting economic crime in India. It is part of the Department of Revenue, Ministry of Finance.
• Central bureau of investigation: Many investigations, raids related finance and bank frauds can be taken with the consent of government.

Conclusion

With increasing bank frauds, online thefts, micro and macro finance theft there is a sheer necessity for robust legal framework on financial frauds.