NEW DELHI: The Enforcement Directorate (ED) is set to re-examine a string of insolvency resolution cases involving suspiciously large "haircuts" through which promoters buy back their own stripped assets at a discount.
The federal probing agency director warned officers that even offline use of Artificial Intelligence tools can leak sensitive case data, and said agencies should now share information more freely with each other instead of only on a need-to-know basis.
The ED chief also conveyed that the agency got Cabinet approval to expand its staff strength by 60 per cent. The three big decisions came out of the agency's 36th Quarterly Conference of Zonal Officers (QCZO), held at IIM-Bangalore from September 14 to 15 and chaired by the ED Director Rahul Navin.
On the insolvency issue, the ED said in a statement that a session at the conference looked at the clash between protections given to companies under the Insolvency and Bankruptcy Code (IBC) and the ED's own powers to attach property under the PMLA.
Officers found that several recurring tricks have been used to cheat the system. Some promoters get around rules that are meant to stop them from bidding again for their own bankrupt company.
Some inflate claims made by related parties to gain an unfair edge. Some influence the committee that decides how the company's assets are split up.
And in some cases, assets are quietly stripped out beforehand, so the recovery ends up very low -- letting the original promoter buy the company back cheap.
The ED said in a statement that its zones have been told to get copies of all suspicious transaction applications from resolution professionals, step into cases before the National Company Law Tribunal, and open separate money-laundering investigations against those behind such deals.
One such intervention, the ED said in a statement, had already led to an order starting insolvency proceedings against a company being recalled.
On the staff expansion, the ED said in a statement that its sanctioned strength will go up from 2,029 to 3,256 posts. The agency will now have 50 zones handling money-laundering cases and five separate zones — in Delhi, Chandigarh, Mumbai, Kolkata and Chennai — handling foreign exchange violation cases.
The number of smaller functional units will nearly double, from 131 to 241.
This will roll out from January 1, 2027, and the ED said in a statement that the goal is to cut the time an investigation takes from four to five years down to about a year and a half.
Navin had asked all zonal heads to explain the changes to every officer down to the most junior rank, and told them to act faster and stop overthinking decisions before carrying out searches.
Other instructions given to zones, the ED said in a statement, include working more closely with state police, using arrest and bail powers under the PMLA against organised gangs, and finishing at least ten major trials per region within six to eight months.
"All properties already attached must be valued and geo-tagged within six months," it added.
To speed up trials, the agency has set up a live dashboard to track delays and aims to get summons served in over 90 per cent of cases.
On returning stolen money to victims, the ED said in a statement that it has already restored more than Rs 73,800 crore across 76 cases, and zones have been asked to push for restitution even before charges are formally framed.
