The Odisha Protection of Interests of Depositors’ (in Financial Establishment) Act -2013 (OPID Act) would come into force within a day or two with the Govt finalising the framing of relevant rules which would be published through a Gazette notification.
“We expect to issue a Gazette notification of the rules in a day or two in consultation with the law Department so that the process for the implementation of the OPID Act would be expedited to initiate punitive action against the malpractices of the fraudulent financial institutions and recover money of the genuine and small depositors,” said Finance Minister Prasanna Acharya.
He said the rules relating to the OPID Act -2013, that got the Presidential nod on August 13 last, had been cleared by the Chief Minister. Acharya also said that very soon four designated courts would start functioning at Bhubaneswar, Brahmapur, Baleswar and Sambalpur to deal with the cases of financial fraud, particularly the embezzlement of huge public money by the shady chit fund organizations.
The Government had already issued a Gazette notification for constitution of the four designated courts. The order of the Odisha High Court is awaited relating to the appointment of the judges in the rank of Additional District Sessions Judge to undertake the trial and hearing of the cases relating to chit fund scam and other related frauds by the Non-Banking Financial Companies (NBFCs) and exercise control over the properties attached by the Government.
The Finance Minister said that all the cases concerning the fraudulent activities by the chit fund companies would be handed over to the designated courts to dispose of the cases in a fast-track manner in a stipulated time frame. Steps would be taken to return the money to the “small and genuine” depositors within six-months of the completion of legal process, Acharya said, who added that special prosecutors would be engaged by the Government for speedy disposal of the cases.
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Implementation of depositor protection law soon, says FM
The Act empowers the State Government to attach and confiscate the properties of the fraudulent financial organizations to return the money to the affected depositors and also initiate criminal action against erring financial institutions. The Government can attach the money or other property alleged to have been procured either in the name of the financial establishment or in the name of any other person from and out of the deposits collected by the organization. Besides, if it transpires that such money or other property is not available for attachment or not sufficient for repayment of the depositors , such other property of the tainted financial establishment or the promoter, director, partner, manager or member of the organization or a person who has borrowed money from properties of that person in whose name properties were purchased out of the deposits collected by the financial establishment, the Government may transfer the control over the money or property to the competent authority as per the provision of the Act. Even the Government with the approval of the competent authority could confiscate the attached properties during the process of hearing.
Earlier, to probe the multi-crore chit fund scam, the State Government has constituted an enquiry commission headed by retired Chief Justice of Sikkim High Court RK Patra. A corpus fund of Rs 300 crore was also announced to give relief to the genuine small investors who have lost their money in the scam.
As per the Government estimates, 7 lakh people have been duped to the tune of Rs 4,375 crore between January 2012 and June 2013 by the chit fund companies in the State. The State police and Crime Branch have taken action against 127 firms, filed around 280 cases and arrested more than 300 persons for involvement in the illegal ponzy scheme.