To check the ponzi menace, government today proposed to come out with a comprehensive central legislation to safeguard the public from getting defrauded by illicit deposit taking schemes.
"In the recent past, there have been rising instances of people in various parts of the country being defrauded by illicit deposit taking schemes. The worst victims of these schemes are the poor and the financially illiterate. The operation of such schemes are often spread over many States.
"I, therefore, propose to bring in comprehensive Central legislation in 2016-17 to deal with the menace of such schemes," Finance Minister Arun Jaitley said in the Budget 2016-17 speech.
Currently, Collective Investment Schemes (CIS) are regulated by Sebi and refer to pooling of more than Rs 100 crore from investors under any scheme or arrangement and which is not registered with capital markets regulator.
However, there is no comprehensive legal framework for all kinds of illicit money pooling schemes they are mostly governed by state-level laws.
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