SFIO to get strong teeth under new companies bill
The government plans to empower the Serious Fraud Investigation Office — with a statutory status to file chargesheets, impose punitive measures and in specific instances, even arrest persons found guilty of corporate crimes. Mahua Venkatesh reports. Empowered sleuthsbusiness Updated: Jul 28, 2011 02:09 IST
The government plans to empower the Serious Fraud Investigation Office (SFIO) — the agency mandated to investigate corporate scams — with a statutory status to file chargesheets, impose punitive measures and in specific instances, even arrest persons found guilty of corporate crimes.
The companies bill, which the government expects Parliament to clear in the forthcoming monsoon session, will contain specific clauses that defining “fraud” and SFIO in the bill itself.
The SFIO investigation report would be treated in a manner similar to police report in the Court of law. This would allow faster prosecution in SFIO investigated matters and cases, said an official on the condition of anonymity.The companies bill legislation aims at overhauling corporate governance norms and grant shareholders with greater powers to defend their rights.
The bill, which was introduced in Parliament in August 2009, is expected to be sent to the Cabinet shortly for approval incorporating amendments suggested by the Parliamentary Standing Committee on Finance.
The SFIO, set up in 2003, is a multidisciplinary agency empowered to investigate cases of alleged frauds that have substantial involvement of public interest either in terms of monetary misappropriation or in terms of persons affected.
It includes experts from the fields of accountancy, forensic auditing, taxation, information technology, capital markets and financial transactions and has filed reports and cases against 42 companies including the erstwhile Satyam Computer Services.
The SFIO would also soon embark on an aggressive recruitment drive and at least 80 officials are expected to join by the end of the fiscal year.
First Published: Jul 27, 2011 22:44 IST