Corporate Frauds

From 2012-13 up to 31-01-2016 the Ministry has ordered investigations through Serious Fraud Investigation Office (SFIO) of this Ministry into the affairs of 258 companies allegedly indulging in fraudulent/ illegal activities. Of these, 116 investigations have been completed and reports submitted to the Ministry, while in 08 cases, investigations have been stayed by the Courts. Further, out of the completed investigations, Ministry has ordered filing of prosecutions in 102 cases, against companies/ directors/ officers in default on account of various non-compliances/ offences committed under the Companies Act, 1956 and other Statutes, as recommended in the investigation reports.

Steps taken by the Ministry include:

• the term “Fraud” has been defined in the Companies Act, 2013;
• Stricter norms of Corporate Governance and their implementation in the Companies Act, 2013;
• Statutory status to the Serious Fraud Investigation Office (SFIO);
• Increasing application of technology for early detection of frauds through data mining and Forensic Audit, etc.

This was stated by Shri Arun Jaitley, Minister of Corporate Affairs in written reply to a question in the Lok Sabha.