(liveMint)
The government on Wednesday decided to bar as many as 300,000 directors of companies that have defaulted on statutory compliances from serving on the boards of other firms to improve corporate governance and check financial irregularities through the use of shell companies.
The ministry of corporate affairs, which regulates unlisted companies, also decided to track down the beneficial owners of suspected shell companies and take penal action against those who divert funds from companies that are struck off the records of the Registrar of Companies (RoC).
The ministry said it is also monitoring the action being taken by regulatory bodies against professionals such as chartered accountants, company secretaries and cost accountants who have been found to have colluded with the shell companies in committing financial irregularities. The move came a day after the government froze the bank accounts of more than 200,000 companies struck off the records of RoC to prevent their directors from accessing the accounts.
