Directorate of Enforcement (ED)

GS-2 Mains 

Short Notes or Revision Notes 

Question : Examine the powers vested in the Directorate of Enforcement (ED) to investigate and act against violators of economic offenses.

About Directorate of Enforcement (ED)

  • Established in 1956 under Department of Economic Affairs.
  • A multi-disciplinary organization investigating:
    • Money laundering offense
    • Foreign exchange law violations

Statutory Functions

  • Enforces Acts:
    • Prevention of Money Laundering Act (PMLA) (2002)
      • Traces assets from proceeds of crime.
      • Attaches property and prosecutes offenders.
      • Confiscates property by special court.
    • Foreign Exchange Management Act (FEMA) (1999)
      • Investigates suspected contraventions of foreign exchange laws.
      • Imposes penalties on those who break the law.
    • Fugitive Economic Offenders Act (FEOA) (2018)
      • Attaches properties of economic offenders who fled India.
      • Confiscates properties to the Central Government.

Powers of ED

  • Extensive powers to investigate and act against violators.
  • Summon individuals for evidence or record production during investigations.
  • Special power to confiscate disproportionate assets under PMLA.


  • Overburdened and lengthy investigations due to:
    • Complex financial transactions
    • Legal hurdles
    • Need for coordination with other agencies
  • Political interference.
  • Lack of coordination between ED and other law enforcement agencies.
  • Legal challenges:
    • Delays in court proceedings
    • Interpretation of legal provisions
    • Limitations in legal framework
  • International cooperation:
    • Differences in legal systems
    • Jurisdictional issues
    • Diplomatic complexities

Way Ahead

  • Strengthen institutional capacity of ED.
  • Enhance coordination with other agencies.
  • Ensure independence and autonomy of ED.
  • Provide adequate resources and training to ED personnel.
  • Reform legal framework and international cooperation mechanisms.


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