In the midst of continued controversies and political rhetoric directed at the ED by the Opposition, the agency has increased its efforts on restitution. In August, the directorate started the legal procedure to give back funds to victims of fraud and legitimate claimants, which involved two notable cases of financial fraud. Nevertheless, in the last two months, the central agency has confiscated greater amounts in different instances of ponzi schemes and bank fraud, as well as real estate fraud cases, initiating the reimbursement process shortly.
As per instructions from the Prime Minister’s Office, the ED is currently focusing on ensuring quick return of funds obtained illegally or fraudulently to the people, banks, and organizations. A senior officer of the directorate stated that the directorate is making an increased push to guarantee quick recovery and compensation for victims of financial fraud cases.
In the last two years, we have started the reimbursement procedure for almost Rs 16,500 crore, covering compensations for victims of scams such as Rose Valley and similar schemes. In the last two months, we have started a restitution process to return the funds to the victims in the Rose Valley ponzi scam and SRS case. The officer stated that extra assets recovery had been included in the process, which is expected to greatly increase the amount for restitution.
The directorate has effectively returned properties to the rightful owners in three significant cases, totaling more than Rs 16,400 crore. Another senior official from the directorate mentioned that the ability to restore assets during the trial stage, after charges are filed, is now feasible thanks to amendments in 2018 to Section 8(8) of PMLA.
Three significant instances involve the cases of Vijay Mallya, where a sum of Rs 14,131.60 crore was returned to a group of public banks headed by SBI, and Nirav Modi, where a total of Rs 1,052.58 crore was repaid to banks led by Punjab National Bank. Both Mallya and Modi were labeled as fugitives according to the Fugitive Economic Offenders Act, 2018, allowing for recovery in the interest of the public. “The officer stated that the banks have already been reimbursed,” .
Along with the previously mentioned cases, a total of Rs 1,200 crore was returned to 8,433 public investors who were victims of fraud in the National Spot Exchange Limited (NSEL) incident. The Bombay High Court has designated a committee to supervise the restitution process as per the Maharashtra Protection of Interest of Depositors Act, 1999.
A committee, chaired by retired Justice Nandrajog, was established by the Supreme Court to oversee the process. The officer elaborated that ED played an important part in returning property valued at 17.19 crore for distribution.
By September, ED has successfully given back approximately Rs 16,400 crore to victims, predominantly public banks and deceived investors collectively, establishing important examples in India’s battle against financial deceit and guaranteeing that stolen assets are recovered for the benefit of the public during legal proceedings. The officers, who are part of the process, stated that the directorate is making efforts to give back money to additional victims of financial frauds through the appropriate sections of PMLA.