Trinamool MP Sudip Bandyopadhyay wants the use of the phrase ‘chit fund’ banned.

The Lok Sabha on February 13 passed a bill to protect gullible investors from ponzi schemes, with Finance Minister Piyush Goyal saying the government will ensure that no loophole is left while framing rules.

The Banning of Unregulated Deposit Schemes Bill, 2018, seeks to put in place a mechanism by which such depositors can be compensated. It has incorporated recommendations of the Standing Committee on Finance.

Replying to a discussion on the Bill, Mr. Goyal said out of the total 978 cases of unauthorised deposit schemes, 326 are from West Bengal, which is more than one-third of the total such schemes.

“The government has worked quickly to put an end to such unauthorised deposit schemes. We have ensured that no loopholes are left by using great legal acumen while drafting the Bill. I want to assure the House that while drafting the rules we will ensure there is no loophole,” Mr. Goyal said.

The bill, which was introduced in the House on February 12, seeks to plug loopholes which allow ponzi schemes to target small investors.

The bill was passed on February 13 — the last day of Budget session — by a voice vote after a short discussion.

The government expects the bill will effectively tackle the menace of illicit deposit-taking activities, and prevent such schemes from duping the poor and gullible people of their hard earned savings.

The bill was initially introduced in Parliament on July 18, 2018 and was referred to the Standing Committee on Finance.

Sudip Bandyopadhyay (Trinamool) said that even though his party supports the bill, ponzi cases like Sahara were not being investigated properly. He also suggested that the government should ban the use of the phrase ‘chit fund’.