The Kerala State government is currently considering a major overhaul of Section 18(b) of the Kerala Money-Lenders’ Act of 1958. The proposed amendments aim to address the serious issue of individuals pawning counterfeit gold with moneylenders, making the crime much more difficult to get away with. This initiative was announced by Finance Minister K.N. Balagopal in the Assembly on Monday, September 29, 2025, in response to a submission by Kovoor Kunjumon highlighting the need for stricter penalties.
A Growing Problem: 861 Cases Registered
Minister Balagopal revealed that a staggering 861 cases related to pawning fake gold have been registered by the police during the current government’s tenure. While Section 18(b) of the existing Money-Lenders’ Act addresses penalties for violating its provisions or making false claims, and the Bharatiya Nyaya Sanhita (BNS) 318(a) allows for non-bailable charges with up to seven years imprisonment and a fine, it has been observed that offenders often receive lenient sentences.
The government believes that revising Section 18(b) is crucial to curb the fraudulent practice of pawning fake gold and to ensure that financial institutions are fully compensated for their losses. The planned amendments will empower authorities to confiscate or attach the property and assets of individuals found guilty of pawning fake gold, directly recovering the losses incurred by the lending institutions. A definitive decision on these vital amendments is expected from the government very soon.