Old high denomination currency notes were laundered using the banking channels by a set of hawala and entry operators in connivance with bank officials.
Axis Bank suspended two of its managers on Monday after they were arrested by the Enforcement Directorate under the Prevention of Money Laundering Act (PMLA) case for their alleged involvement in settling of unaccounted money. The accused officials will be produced before the Tees Hazari court at around 2 pm on Monday for further interrogation.
Both managers had allegedly taken gold bricks as bribe to convert Rs 40 crore black money into white. Money from three bank accounts was transferred to jewellers via RTGS mode of payment to buy gold. The ED is probing the case and has initiated an investigation into the matter to unmask the other people involved in the corruption.
Old high denomination currency notes, which ceased to be legal tender from midnight of November 8, 2016, were laundered using the banking channels by a set of hawala and entry operators in connivance with bank officials.
On the basis of specific information received on November 22, 2016, Delhi police intercepted three persons carrying around Rs 3.7 crore in old denomination notes in front of Axis Bank's Kashmere gate branch. The case was then handed over to Income Tax department for investigation. After preliminary investigation, Delhi Police registered an FIR on November 29, 2016. On the basis of FIR, Enforcement Directorate registered a case under PMLA, 2002 on November 30, 2016, and initiated investigations.
During the investigation by the ED, the following modus operandi was revealed:
After demonetization of the high denomination currency notes, certain persons having old currency notes were looking to convert their old currency notes into gold even at inflated rates. Such persons were contacted by the jewellers who collected the cash from these parties as advances against gold to be sold at high prices ranging from Rs 45,000 to Rs 50,000 per 10 grams. The cash so collected was laundered through banking channels with the help of money launderers who are professionally qualified Chartered Accountants and managing several dummy/shell companies. Finally, payments from such shell companies were made through RTGS to Bullion dealers and the physical gold so purchased at market rate of Rs 31,000 to Rs 32,000 per 10 grams was handed over to the persons from whom advances were received.
The Enforcement Directorate broke this modus operandi in the case of one group of Rajeev Kushwaha CA, Devendra Kumar Jha and Raj Kumar Sharma. Various shell companies, namely, Sunrise trading company, Himalaya International, RD Traders etc, who have bank accounts in Axis Bank's Kashmere Gate branch, were used to deposit cash to the tune of Rs 39 crore between the period November 10 to November 22, in close connivance with the bank managers Vinit Gupta and Shashank Sinha. These cash deposits were in the installments of Rs 90 lakh to Rs 99 lakh so as to avoid detection or reporting to government agencies. In several instances, more than one such cash deposit in a day were made into these accounts. These cash deposits were then further transferred by way of RTGS to M/s Beagle Marketing Pvt. Ltd. on the same day, which is another shell company managed and controlled by Rajiv Singh Kushwaha by way of dummy directors.
Upon investigation, it was found that one of the director of Beagles Marketing, Ram Charan, was found to be a petty labourer working for daily wages and staying in a slum at Anna Nagar Jhuggi Camp, New Delhi. Ram Charan expressed ignorance about the existence of the company. It was found that directors of the other shell companies were also persons of no means.
On the instructions of the jewellers and Rajiv Kushwaha, the funds were further transferred by way of RTGS from the account of Beagle marketing to various Bullion Traders named Aadi Traders, Siddhi Vinayak Jewellers, Tushar Jewellers etc in lieu of purchase of gold bars. Though invoices were raised by these bullion dealers in the name of Beagle Marketing Pvt. Ltd., the physical delivery of the gold was given to jewellers. The gold purchased by these jewellers was further sold to various buyers at Rs 45,000 to Rs 50,000 per 10 grams.
While interrogating the middleman, it was revealed that the bank officials agreed to this modus operandi in exchange for commission or bribe of 2% of the amount deposited in cash in these accounts. This gratification was given to bank managers Vineet Gupta and Shobhit Sinha in the form of gold bars (at 1% each). One of the gold bars has been recovered and seized from Lucknow using information received from Sinha's statement. Another two kilos of gold bars have been seized from one of the jewellers.
During the interrogation of the bank managers, it was revealed that huge amounts of cash was also exchanged in the initial three days without following due procedure prescribed by RBI. For this bulk exchange, forms and unverified identity documents were received from certain customers along with old currency notes which were exchanged by giving them new currency notes amounting to several lakhs. The directorate has arrested both bank managers for their connivance and further investigations are in progress
Reacting to the arrest, an official spokesperson of the bank said, "The bank is committed to following the highest standards of corporate governance and has zero tolerance towards any deviation on the part of any of its employees from the set model code of conduct. In this particular case, the bank has suspended the erring employees and is cooperating with the investigating agencies."
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
 "Axis Bank")
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
)
){kind=small}
){kind=small}
)
)
)
)
)
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}