Inter-Ministerial Group Constituted to tackle Fraudulent Money Pooling Activities via Ponzi Schemes

May 8, 2013 10:53 IST

The Union Government of India on 7 May 2013 constituted an Inter-Ministerial Group to suggest the possible ways to tackle with the fraudulent money pooling activities and protect the investors’ interest in the same.

Members of the inter-ministerial group will comprise of representatives from the Finance and Corporate Affairs Ministries, Reserve Bank of India (RBI) and Securities and Exchange Board of India (SEBI).

The decision to constitute a Inter-Ministerial Group was taken in wake up of the instances of people being defrauded by Ponzi Schemes like the Kolkata-based Saradha Group cheating in which many investors were fooled via fraudulent money pooling schemes.

Ponzi Schemes are activities that involve collecting money from public (investors) on a large scale making fraud promises of big returns. These are paid from the money that is paid by the new investors and in this type of scheme the old investors get big returns by bringing in new investors.

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