India slaps Rs 7100 crore fine on UAE ‘s Etisalat

published on July 11, 2011

2G scam: ED slaps Rs 7,100 crore fine on Etisalat DB
Pradeep Thakur, TNN

NEW DELHI: The Enforcement Directorate on Friday slapped a Rs 7,100 crore showcause notice on Etisalat DB for allegedly violating Foreign Exchange Management Act (FEMA) in what marks the second prong of the multi-agency investigation into the 2G scam.

The notice, based on details of the investigation into alleged violations of law by Etisalat DB, comes with the warning that the penalty will be increased three times if the company fails to respond to the showcause within a month.

Listing the alleged transgressions, ED’s investigating officer has said that Etisalat-Dubai and Genex Exim acquired equity in Shahid Balwa-promoted Swan Telecom in contravention of rules. The ED report said shares were issued at very high prices just to bypass the Foreign Investment Promotion Board (FIPB).

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