I-T dept raids Chinese firms for money laundering, hawala

nNEWDELHI:THE Income Tax department on Tuesday raided certain Chinese individuals and Indian professionals allegedly involved in money laundering and hawala transactions, officials said.

The IT department said it found that more than 40 bank accounts were created in India, which were linked to several shell companies, in which transactions worth ~ 1,000 crore were done over a period of time.

Officials familiar with the probe said the main suspect was identified as an individual identified as Charlie Peng, a Chinese national living on a fake Indian passport in Manipur for six years. Around half a dozen of his associates were also identified.

People in the IT department and finance ministry, familiar with the raids, said Peng was taking the help of some Indian chartered accountants and bank officials for alleged illegal financial transactions through shell companies and was also using the hawala route. A subsidiary of a Chinese company was identified and its role is being investigated, the officials added. The Enforcement Directorate (ED) is likely to be roped in for money laundering investigations and Central Bureau of Investigation may be asked to probe. “Based on the credible information that few Chinese individuals and their Indian associates were involved in money laundering and hawala transactions through series of shell entities, a search action was mounted at various premises of these Chinese entities, their close confederates and couple of bank employees,” a Central Board of Direct Taxes statement said.

The IT raid revealed that at the behest of Chinese individuals, more than 40 bank accounts were created in various dummy entities, entering into credits of more than ~1,000 crores over the period. “A subsidiary of Chinese company and its related concerns have taken over ~100 crores bogus advances from shell entities for opening businesses of retail showrooms in India.”

“Further, incriminating documents in respect of hawala transactions and laundering of money with active involvement of bank employees and Chartered accountants has been found as a result of search action. Evidences of foreign hawala transactions involving Hongkong and US dollars have also been unearthed. Further investigations are under progress,” it added. The department refused to divulge the name of other Chinese individuals, companies or details of alleged transactions.