Note4Students
From UPSC perspective, the following things are important :
Prelims level: Fugitive Economic Offenders (FEOs)
Mains level: Extradiction of FEOs
Central idea: India has called upon G20 countries to adopt multilateral action for faster extradition of fugitive economic offenders (FEOs) and recovery of assets both on the domestic front as well as from abroad.
Who are Fugitive Economic Offenders (FEOs)?
- FEOs are individuals who have fled their home country to avoid facing prosecution for financial crimes such as money laundering, fraud, and embezzlement.
- These individuals typically engage in illegal activities that involve large sums of money and often cause significant damage to the economy of the country they have fled.
FEOs and India
- India has put in place specialized legislation in this regard, in the form of the Fugitive Economic Offenders Act, 2018.
- It defines the term- as an individual against whom a warrant of arrest in relation to a scheduled offense has been issued by any court in India and who has left the country so as to avoid criminal prosecution; or the FEO abroad, refuses to return to face criminal prosecution”.
Why do offenders go fugitive?
- Finding safe heavens: FEOs seek refuge in countries that do not have an extradition treaty with their home country or that have weak extradition laws.
- Evading justice: FEOs often exploit legal loopholes and the differences in laws and regulations across countries to evade justice.
- Asset offshoring: They may move their assets to offshore accounts or invest in assets such as real estate and art that are difficult to seize.
How FEOs impact the economy?
FEOs can have a significant impact on the economy of the country they have fled from.
- Loan defaults: They may default on loans, engage in fraudulent activities, and siphon off large amounts of money from banks and financial institutions.
- NPA crisis: This can lead to a rise in non-performing assets (NPAs), a slowdown in economic growth, and a loss of investor confidence.
International mechanisms for FEOs
Some of the key international mechanisms for FEOs are:
- Extradition treaties: Many countries have extradition treaties in place with other countries that enable them to request the extradition of individuals who have fled to other countries to avoid prosecution.
- Mutual Legal Assistance Treaties (MLATs): MLATs are agreements between countries that facilitate the exchange of information and evidence in criminal investigations and proceedings.
- International Conventions and Agreements: There are several international conventions and agreements that address financial crimes and provide a framework for international cooperation. Ex. UN Convention against Corruption, FATF etc.
- INTERPOL: Interpol facilitates cross-border police cooperation and coordination. It maintains a database of wanted individuals, including FEOs, and works with member countries to locate and apprehend them.
- Asset recovery: Such mechanisms are designed to enable countries to recover assets by means of seizure and repatriation of assets, as well as the freezing of assets to prevent FEOs from accessing them.
Way forward
- Strengthening domestic laws: India can strengthen its domestic laws and regulations to make it easier to prosecute FEOs and recover their assets.
- Developing extradition treaties: India can work to develop and strengthen extradition treaties with other countries to ensure that FEOs are not able to evade justice by fleeing to other countries.
- Enhancing international cooperation: India can enhance its cooperation with other countries and international organizations to facilitate the sharing of information and intelligence about FEOs.
- Seizing and repatriating assets: India can work to seize and repatriate assets that have been acquired through illegal means by FEOs.
- Improving transparency and accountability: India can improve transparency and accountability in its financial system to prevent FEOs from exploiting loopholes and engaging in illegal activities.
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