(a) whether as per a report the cases of fraud in corporate sector are increasing continuously;
(b) if so, the details thereof along with number of such cases which have come to the notice of
the Government during each of the last three years;
(c) the action taken by the Government thereon;
(d) whether the Government proposes to set up any regulator in view of increasing cases of fraud
in corporate sector; and
(e) if so, the details thereof?
MINISTER OF THE STATE (INDEPENDENT CHARGE) IN THE MINISTRY OF CORPORATE AFFAIRS (SHRI SACHIN PILOT)
(a) to (c) Reports appearing in a section of the media indicate that a Section 25 Company, “Thought Arbitrage Research
Institute†has published a study indicating, inter alia, occurrence of frauds in companies due to factors like inadequate
internal control procedures, diversion of funds by promoters/ top management, failure of auditors in detection of frauds,
etc. These factors are in any case widely recognised causes of frauds in companies. During the last three years, the
Ministry has ordered investigations under section 235 of the Companies Act, 1956 in 134 cases of corporate frauds through
the Serious Fraud Investigation Office (SFIO) of the Ministry. Year-wise details are as under:
Year No. of companies ordered for investigation
2011-12 12
2012-13 46
2013-14 (Till date) 76
Total 134