India: Cracks Down on Shell Companies

By in

The Indian government has noticed a rapid wave in shell companies which were depositing cash in banks, apparently in an attempt to hide who owned that wealth.

This is following the surprising ban of high denomination currency bills last year by India’s Prime Minister, Narendra Modi.

According to Modi’s top aide, the moment was a revelation for the Indian authorities due to the fact that the government did not comprehend the extent to which shell companies were being utilised for money laundering purposes and hiding assets.

Moreover, the Prime Minister’s office has now assembled a team of revenue officials and top law enforcement to chase such companies. In July, the authorities arranged for approximately 200,000 shell companies to be shut down, as the government continues to inspect thousands more.

On the 7th of August, the Securities and Exchange Board of India (SEBI) announced a surprising approach to the stock exchanges, which essentially freezes the suspected trade in 331 shell companies.