In the eight years from 2014, the Directorate of Enforcement (ED) has investigated 121 prominent politicians and has arrested, questioned, raided, or filed FIRs against 115 major Opposition leaders. By contrast, during the 10 years (2004-14) of the UPA-II government, only 26 leaders were investigated, including 14 from the Opposition.
Since the advent of the Narendra Modi government, the ED has gone after politicians suspected of corruption with far greater alacrity than other central law enforcement agencies.
PMLA, the ED’s sword arm
The ED’s aggression has been largely on account of its current Director Sanjay Kumar Mishra (since 2018) and his predecessor Karnal Singh (2015-18) leveraging the massive powers bestowed on the agency by the Prevention of Money Laundering Act (PMLA), 2002.
Unlike laws governing other agencies, particularly the CBI, the PMLA allows the ED to take cognizance of any offence under its wide-ranging schedule across the country, with or without the consent of state governments.
It has, therefore, been able to register money laundering cases against politicians or activists based on FIRs filed by state police forces — something the CBI is unable to do unless requested by the state government, or ordered by a court or the Central Vigilance Commission (CVC).
While the National Investigation Agency (NIA) too has powers to take suo motu cognizance of offences across the country, the schedule of the NIA Act — that is, the types of offences that it can investigate — is limited to about a dozen offences.
The schedule of the PMLA on the other hand, has increased from just six offences in 2002 — when the law was enacted — to 30 groups of offences encompassing over 147 provisions now. The ED’s sweeping ambit extends from serious crimes such as terrorism to the hunting of wild animals, and from the infringement of copyright to false trademarks.
The provisions of the PMLA, which give investigators the power to arrest and attach properties and assets of accused, impose stringent bail conditions, and make a statement recorded before an investigating officer admissible in court as evidence, have made the ED much more powerful than the CBI.
The PMLA’s ambit was widened through amendments in 2009, 2013, 2015, and 2019, giving the ED the teeth it now has.
- In 2009, ‘criminal conspiracy’ under Section 120B of the Indian Penal Code was added to the PMLA’s schedule among various other offences. This has, over the years, allowed the ED to enter any case where a conspiracy is alleged — even if the principal offence is not part of the PMLA schedule. In 2009, the ED also got international jurisdiction as far as tracking laundered money was concerned.
- Following amendments in 2015 and 2018, the ED was allowed to attach properties in India equivalent to properties acquired abroad through laundered money.
- Through certain “explanations” inserted into the PMLA in 2019, the government allowed the ED to attach properties earned directly or indirectly through alleged criminal activity that was even “relatable” to a scheduled offence.
The PMLA’s provisions on admissibility of statements made by the accused as evidence, and the stringent bail provisions have been the most contentious. It is the only Act in the country in which a statement recorded before an investigating officer is admissible in court as evidence. Other laws that contained such provisions, such as TADA and POTA, have long been repealed.
The provision for bail stipulates that a magistrate will not grant bail to an accused unless he is convinced that prima facie no case is made out. This provision was struck down by the Supreme Court on the ground that it presupposed the trial at the stage of bail itself. But a larger bench headed by Justice A M Khanwilkar on July 27 this year upheld the validity of all the provisions of the PMLA, including strict bail conditions in money laundering cases.
This has resulted in accused being put behind bars for long periods without bail in offences that attract punishments ranging from two to seven years, literally making the process the punishment.
Bigger and more fearsome
Under Director Mishra, the ED has applied these provisions on suspected offenders with much greater ferocity than before, even as the strength of the agency has increased from the motley group of about 400 officials under the UPA to 1,600 officials now. The ED’s sanctioned strength is over 2,000.
The ED’s expanding scope of work is also reflected in the sheer number of cases it has taken up lately. Under the UPA, the ED registered 1,867 cases of money laundering, which involved 112 raids and attachments of properties to the tune of Rs 5,346 crore.
Under the NDA, according to data available until March 2022, almost double the number of cases — 3,555 — were registered. The number of raids (3,010) was 27 times more, and the value of attachments (Rs 99,356 crore) was 18 times higher than under the UPA.
Of the 3,555 PMLA cases registered by the ED under the NDA, 3,066 were registered over the last five years, a period in which 2,564 of the 3,010 raids were carried out.
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ED officials say the criticism that the agency is targeting Opposition politicians is baseless because it can only take cognizance of an offence already registered by the CBI or state police.
“Those being probed by us have already been booked by other agencies, so how is ED targeting them? Only after a politician is accused of corruption by the CBI or the vigilance department of a state do we come in to probe money laundering. Also, a wrong impression has been created that we have a poor conviction rate. Of the 21 cases of money laundering in which trials has been completed, we have achieved convictions in 18, with 30 people having been convicted,” a senior ED official said.