Are agency money transfers “sudden”? Recent raids at a glance

Over the past couple of months, central and state investigative agencies have carried out major cash recoveries in West Bengal.

Imagine this.

On July 23, the Directorate of Law Enforcement (ED) seized Rs 21.2 crore in cash from one of the apartments of Arpita Mukherjee, a close associate of the discredited Trinamool Congress leader ( TMC), Partha Chatterjee, in her upscale apartment in Diamond City near Tollygunge in South Kolkata, while investigating School Service Commission (SSC) recruitment irregularities in Bengal.

On July 29, the ED recovered Rs 27.9 crore in cash and 6 kg of gold from another apartment belonging to Arpita Mukherjee of the Club Town Heights condominium in Belgharia in the northern outskirts of Kolkata, while investigating the same case.

· On September 4, the Bengal Crime Investigation Department (CID) raided the residence of a fish seller, Jayprakash Saha, in Gazole, Malda and recovered Rs 1.4 crore in cash.

On September 10, the ED raided the home of Amir Khan, son of businessman Nesar Ahmed Khan, in the Garden Reach district of southwest Kolkata, in connection with a case of online gambling fraud and recovered Rs 17.32 crore.

So the question is why these sudden cash inflows?

NOT SO SUDDEN

Historically speaking, Kolkata is no stranger to money laundering and shell company operations. In fact, independent India’s first major financial scam took place in this very city in 1957, when Haridas Mundhra, an industrialist and stock speculator based in the city, asked the Life Insurance Company (LIC) to invest a sum of around Rs. 1.27 crore in shares of six of his troubled companies.

Since then, the city has been home to a well-developed ecosystem for bringing black money back to the books of business through shell company conduits, fake administrators and their operators, fake current accounts in banks and a maze of layers of transactions that make it a daunting task for tax detectives to track the money and identify their ultimate beneficiaries.

REPRESSION ON THE GAME ‘SHELL’

Over the past few years, the Income Tax (IT) Department has identified up to 35,000 Kolkata-based front companies and filed charges against nearly 100 money-moving operators. illegal.

The well-established money laundering system in the city ensured that cash never had to be stored. But new roadblocks and hurdles put in place by government agencies over the past few years appear to have halted laundering operations.

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“Cash hoarding is a new phenomenon in Kolkata. Previously, there was no need to hoard money. The black money was funneled back into the system through the established shell company network system. All these companies needed a business license from the Kolkata Municipal Corporation, which allowed them to open current accounts in several banks and deposit money in small amounts into these accounts. A maze of money transfer layers was then implemented whereby the money was transferred back to the recipient’s account,” an IT department official explained, speaking on condition of anonymity.

“The identification of shell companies and their operators since 2015-16 by the IT department, together with the Serious Fraud Investigation Office (SFIO) and the Registrars of Companies (ROC), has resulted in a temporary decline in these operators and established money laundering. network. The turnaround time for the money to be pumped back into the system now takes longer than before. This is why we are seeing so many thefts of money taking place somewhere in an intermediate phase of an incipient money laundering operation where the money cannot be easily pumped,” the officer said.

“This, together with some tough IT law amendments and court verdicts in favor of the IT department, put in place tough hurdles ahead of the shell company’s operations,” he added.

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Another officer, however, said: “Although the demonetization was a good move, the launderers used the buffer period of three months for the conversion of banknotes to obtain large sums of money in denominations of Rs 2,000. “

HAWALA ROUTE

The other option is to move the money by hawala, but this requires logistical arrangements for the transit of the money. As hawala operations are mostly conducted from Mumbai, money has to be physically transported in small installments through rail or road network which is time consuming.

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Bombarded with actual images of cash hills inside homes, a phenomenon so far seen only on (real-life) money screens and intricate details of how the money was hidden, how it was found and even the number of safes brought by the agencies to transport the seized money, the economic sensitivity of the average Bengali takes a hit.
However, this is not the first time agencies have collected money from bogus entities. Why then do the images of cash, recorded at the time of the search operations, almost immediately give way to the mass media, whereas previously the media had little or almost no access to these operations behind closed doors?

INTEREST

“Judging from conversations on social media and public spaces, people are more keen to find the political netas connection behind the money than the immediate suspect,” a central agency official said under cover of a statement. ‘anonymity.

“While in the SSC scam case immediate links were said to have been made between Arpita and Partha, in the latest Garden Reach money-carrying case, more people seem to be talking about local MP and Trinamool leader Firhad Hakim than the initial suspect, Amir Khan, who is on the run,” the officer said.

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