Mis-leading the investors while raising the money by promoters in respect of 78 Companies came to the notice of this Ministry during last three years and the current year. This Ministry has ordered investigation into the affairs of the said companies under Section 235 of the Companies Act, 1956, by the SFIO.

This Ministry has established a fund called ‘Investor Education and Protection Fund (IEPF)’ under Section 205C of the Companies Act, 1956. The objectives of the fund is to support the activities relating to Investor Education, Awareness and Protection.

This information was given by Smt. Nirmala Sitharaman, MoS in the Ministry of Corporate Affairs in written reply to a question in the Lok Sabha today.

Misleading investors: statutory corporate investigations initiated and an investor protection fund supports education and awareness. Misleading solicitations by promoters prompted statutory probes under Section 235 of the Companies Act to investigate alleged promoter misrepresentation in fund-raising; a dedicated corpus, the Investor Education and Protection Fund under Section 205C, is designated to support investor education, awareness and protection activities.