Economic crime is the responsibility of the Enforcement Directorate(ED) organization, which also deals with the problems associated with economic crime in India and fights against them. It also functions as an economic intelligence organization, tasked with ensuring that the terms of two major laws governing the country’s economic growth are implemented as effectively as possible. The following are the two most important laws:
- The Foreign Exchange Management Act (FEMA), which was passed in 1999,
- The Prevention of Money Laundering Act (PMLA) of 2002.
History of ED
Its origins are traced back to 1956 when a unit under the Economic Affairs Department was established on the 1st of May of that year. It was established to oversee certain matters connected to the breach of the laws of the FERA (Foreign Exchange Regulation Act), which was passed in 1947. After being renamed the “Enforcement Directorate” in 1957, the administrative responsibility of the Enforcement unit was moved to the Revenue Department from the Economic Department in 1960.
The Enforcement Directorate’s Characteristics
- It is a financial investigative agency that examines situations involving financial transactions.
- It’s a division of the Revenue Department of the Ministry of Finance.
- It primarily deals with two pieces of legislation: the FEMA (Foreign Exchange Management Act) and the PMLA (Protection of Mortgage Lending Act)
- It is responsible for ensuring that the stipulations of these two acts are followed.
- For trial and appeal, it has its own set of courts, as well as its appellate tribunals.
- When people break the regulations of FEMA or the PMLA, it conducts investigations and pursues lawsuits in court against them.
- It adjudicates the problems in question, and both statutes have provisions for appealing the decisions.
- It strives to meet the goals of both acts to be successful.
The procedure followed by Enforcement Directorate (ED) for investigation
The search of place and person
Following the filing of a complaint with a government agency or the police department for a scheduled or predicate offense under the PMLA, the complainant must first report to the magistrate as required by Section 157 of the Code of Criminal Procedure. Following the agreement of the Magistrate, the officers can search any location, building, vehicle, or vessel, as well as break down any locker, safe, or almirah, or any other receptacle to exercise his authority. If they have reasonable grounds to think that a person is involved in any crime, they have the authority to search him.
Take possession of the property
Officers have the authority to confiscate any property if they have reasonable grounds to think that the property has any connection to money laundering. When seizing or attaching any property, officers will adhere to the provisions of the Code of Criminal Procedure, 1973. The search and seizure provisions of Sections 17 and 18 of the PMLA apply to any property or person that is under investigation.
Section 19 of the PMLA gives authorities the authority to detain a person if they have reasonable suspicion that the individual is involved in a crime linked to money laundering.
Investigation powers of Enforcement Directorate (ED) officers
A look at section 36 and 37 of the Federal Emergency Management Agency (FEMA) reveals that this agency was established and that its officers have authority to investigate matters that are in violation of the provisions of this act and any other rule or order issued by an agency exercising its authority granted under this act.
Having the authority to probe
Officials below the rank of the assistant director are not permitted to conduct an investigation, however, all other officers above the rank of the assistant director are permitted to conduct an investigation, including the director of Enforcement.
Investigate any person or place
An officer of the Enforcement Directorate has the authority to inspect any location, building, vehicle, or other area to gather evidence that will be used in the subsequent proceedings. He has the authority to go into any locker or almirah in search of evidence and to administer an oath to anybody.
The authority to detain a person
If they find a person guilty of a crime linked to money laundering after an investigation or at any point during an investigation, they have the authority to arrest that person and bring legal action against that person in court.
What actions are taken on the report prepared by the Enforcement Directorate officer?
Following the conclusion of the investigation, officers prepare a report on the matter that includes the following information- the details of the report, the investigation conducted by the officer, the locations and individuals investigated, the attachment report of the attached property, and the report of an arrested person.
It is possible that when the report is prepared, the matter could be adjudicated by the ED own adjudicating body, or that the case would be submitted to the CBI court or the Supreme Court. The party that is aggrieved in the case has the right to file an appeal with the higher court. To appeal a decision, the agency has established its appellate panel.
The Directorate of Enforcement (ED) is a branch of our government that is dedicated to the advancement of our country. This is a government-sponsored organization that works to control and prevent money laundering in India. It is carrying out its mission with a strong and clear vision to serve the country. This agency is supported by a large number of officers from a variety of different agencies.