BRICS weighs law-enforcement network to track economic fugitives
India has proposed a new BRICS mechanism to enable faster, informal information-sharing among law-enforcement investigators across member countries to trace economic fugitives and support extradition
The BRICS Anti-Corruption Working Group, meeting in Hyderabad, reached in-principle agreement on the proposed network
The framework envisages time-bound information sharing, standardised formats for exchanging preliminary investigation details, an asset-recovery framework, technical cooperation, and institutional linkages among BRICS partner agencies
The mechanism is designed to address modern evasion methods, including the use of fintech platforms and virtual digital assets (cryptocurrency) by economic offenders to conceal assets and evade investigation
The proposal will be taken up formally at the 18th BRICS Summit hosted by India in New Delhi
Fugitive Economic Offenders Act, 2018 (FEOA)
The FEOA is India's domestic legal framework to deter economic offenders from evading Indian courts by fleeing the country. It allows for a person to be declared a "Fugitive Economic Offender" (FEO) and enables confiscation of their properties even without a criminal conviction, addressing gaps exposed by high-profile fugitive cases where extradition was slow or unsuccessful.
Key Details
- Enacted 2018, following the Fugitive Economic Offenders Ordinance of the same year
- Applies to scheduled offences where the value involved is ₹100 crore or more
- The Enforcement Directorate (ED) files an application before a Special Court (under the Prevention of Money Laundering Act framework) to declare a person an FEO
- On declaration, the Act permits provisional attachment and confiscation of the offender's properties in India and abroad, and bars the offender from defending any civil claim in Indian courts
- Supplementary applications can be filed if additional properties are discovered after the initial application
The FEOA addresses fugitive economic offenders through India's own courts and asset-confiscation powers, but it cannot compel foreign law-enforcement cooperation — the proposed BRICS network is meant to fill exactly this gap by enabling faster informal information-sharing with partner-country investigators before formal extradition requests are filed.
Extradition and Formal Mutual Legal Assistance vs Informal Law-Enforcement Networks
Formal extradition operates through bilateral extradition treaties and Mutual Legal Assistance Treaties (MLATs), which are often slow due to dual-criminality requirements, judicial review in the requested state, and diplomatic channels. Informal law-enforcement networks — such as Interpol's Red Corner Notices or the proposed BRICS mechanism — allow investigators to share leads and preliminary information directly, ahead of and alongside formal treaty-based requests.
Key Details
- India has extradition treaties with over 50 countries and extradition arrangements with several others, but enforcement outcomes vary widely depending on the treaty partner's cooperation
- Interpol Red Corner Notices are requests to law-enforcement worldwide to locate and provisionally arrest a person pending extradition — they are not international arrest warrants and depend on member-country domestic law for enforcement
- The proposed BRICS network is explicitly framed as "informal cooperation" that "complements" rather than replaces formal extradition and Mutual Legal Assistance processes
By creating a channel for investigators to connect early — before or independent of a formal extradition request — the BRICS proposal seeks to reduce the multi-year delays typically associated with treaty-based extradition, particularly relevant given previous difficulties extraditing high-profile economic offenders who have relocated to jurisdictions with slow or uncooperative legal processes.
Virtual Digital Assets and Cross-Border Financial Crime Regulation
The rise of cryptocurrency and virtual digital assets (VDAs) has created new avenues for economic offenders to move and conceal illicit assets across borders, outside traditional banking-channel monitoring. India regulates VDAs primarily through taxation and anti-money-laundering provisions rather than a dedicated regulatory statute.
Key Details
- India brought VDAs under the Prevention of Money Laundering Act (PMLA), 2002 reporting requirements in March 2023, requiring crypto exchanges to conduct KYC and report suspicious transactions to the Financial Intelligence Unit-India (FIU-IND)
- India taxes VDA transfers at a flat 30% rate plus a 1% TDS on transactions above specified thresholds (introduced in the Finance Act, 2022)
- The Financial Action Task Force (FATF) has issued global standards (Recommendation 15) requiring countries to regulate virtual asset service providers (VASPs) for anti-money-laundering purposes
The proposed BRICS mechanism's explicit focus on crypto-enabled evasion reflects a broader global regulatory challenge — that VDAs, being borderless and pseudonymous, require multilateral, real-time information-sharing arrangements (rather than only treaty-based extradition) to track fugitives who use them to hide assets.
- Threshold for FEOA application: scheduled offences involving ₹100 crore or more
- FEOA enacted: 2018 (via Ordinance first, then Act)
- Nodal agency for FEOA proceedings: Enforcement Directorate, before a Special Court
- India VDA tax: 30% flat tax + 1% TDS (Finance Act, 2022)
- VDAs brought under PMLA reporting obligations: March 2023
- BRICS Anti-Corruption Working Group meeting location for this proposal: Hyderabad