New Delhi: An inter-ministerial panel will meet on Thursday this week to deliberate on ways to strengthen supervision of financial sector to effectively curb fraudulent money pooling activities.
The meeting of the group has been scheduled against the backdrop Kolkata-based Saradha Group allegedly cheating investors through fraudulent money pooling scheme.
The group is headed by Department of Financial Services' Additional Secretary and comprises Joint Secretary level officers from Department of Economic Affairs, Department of Revenue, Corporate Affairs Ministry, RBI and SEBI.
"The Group (IMG) is expected to strengthen the existing coordination mechanisms for regulation and supervision of financial sector," the Finance Ministry had said.
The IMG has been set up to ensure "proper enforcement of regulatory framework for multi-level marketing companies, non-banking finance companies and companies running collective investment schemes".
Many entities have registered themselves as chit funds but are found to be raising money illegally through fraudulent schemes or ponzi schemes by promising high returns.
Meanwhile, Direct Selling Distributors Welfare Association (DSDWA) has demanded setting up of a regulatory authority' to protect interests of consumers and distributors selling products of FMCG, Textiles and Health and Wellness.
"Distributors businesses have adversely affected after the (West Bengal) scam and most importantly consumers faith amongst distributors have also shaken," DSDWA President Surinder Vats said in a statement.
He said there was need for stringent laws to plug possibilities of such scams in future on the lines of tough laws framed by countries like Australia, Malaysia, Singapore and Canada.
First Published: Sunday, May 12, 2013, 18:01