ENFORCEMENT DIRECTORATE (ED) (Syllabus: GS Paper 2 – Polity)

News-CRUX-10     22nd March 2024        
Samadhaan

Context: The Enforcement Directorate (ED) recently arrested the Delhi chief minister on Thursday night for his alleged involvement in the state's controversial 2021-22 excise policy after questioning him at his residence.


 Enforcement Directorate (ED)

  • About: The Directorate of Enforcement is a multi-disciplinary organization mandated with investigation of offence of money laundering and violations of foreign exchange laws
  • Origin: The origins of this Directorate can be traced back to May 1, 1956, when the Department of Economic Affairs established an ‘Enforcement Unit' to handle Exchange Control Laws violations under the Foreign Exchange Regulation Act (FERA), 1947. 

oThis unit was renamed the ‘Enforcement Directorate’ in 1957.

  • Nodal ministry: Department of Revenue of the Ministry of Finance.
  • Organisational structure: The Directorate of Enforcement, with its headquarters at New Delhi, is headed by the director of enforcement. 

oThere are five regional offices at Mumbai, Chennai, Chandigarh, Kolkata, and Delhi headed by special directors of enforcement.

  • Appointment of ED director: The ED Director is appointed by the central government on the recommendation of a committee: chaired by the Central Vigilance Commissioner and  members comprising of Vigilance Commissioners, Home Secretary, Secretary DOPT and Revenue Secretary.
  • Current Status: Presently, the ED operates under the Foreign Exchange Management Act, 1999 (FEMA), the Prevention of Money Laundering Act, 2002 (PMLA), and the Fugitive Economic Offenders Act, 2018 (FEOA).
  • Tenure and Extensions: The Director holds a fixed tenure of 2 years, with the possibility of a maximum of 3 annual extensions.

Function

  • Mandated Investigation: ED investigates offenses related to money laundering and violations of foreign exchange laws.

oIt enforces the provisions of the Prevention of Money Laundering Act (PMLA).

  • Asset Tracing and Attachment: ED conducts investigations to trace assets derived from proceeds of crime.

oIt provisionally attaches the property during investigations.

  • Prosecution Assurance: ED ensures the prosecution of offenders identified during its investigations.
  • Confiscation by Special Court: The Special court, with ED's assistance, confiscates properties related to crimes.
  • Enforcement of FEMA: ED enforces provisions of the Foreign Exchange Management Act (FEMA). It investigates suspected violations of foreign exchange laws.




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