Joint probe into transfer of over Rs. 6,000 crore through Bank of Baroda

It is alleged that the ‘black money’ was transferred out to Hong Kong

The Enforcement Directorate, the Central Bureau of Investigation and the Serious Fraud Investigation Office have launched a joint probe into allegations that Rs.6,172 crore in black money was transferred out to Hong Kong through newly opened current accounts at a Bank of Baroda branch in Delhi last year.

While the ED has registered a money laundering case, a day after the Congress raised the issue, the CBI on Saturday conducted searches at the bank’s Ashok Vihar branch. The CBI has registered a case against 59 current account holders and unknown bank officials.

The matter came to light last month during the bank’s internal audit which revealed that in one year, the foreign exchange business had shot up from Rs.45 crore in 2013-14 to Rs.21,529 crore in 2014-15. Further, there were 8,667 foreign exchange transactions between August 2014 and August 2015.

The audit detected 59 such bank accounts opened in the name of various companies and used to route “unaccounted money” to the same set of Hong Kong-based firms, on the pretext of advance remittances for import of items like cashew, rice and pulses. The amount was deposited in cash, at times through multiple entries a day.

On Friday, Congress spokesperson R.P.N. Singh had demanded independent investigations into the alleged transfer of black money through banking channel.

Alleging the role of top bank and government officials in the scam, the Congress said the transactions in question began two months after the Narendra Modi-led NDA government came to power at the Centre.

“Before the Prime Minister lays the blame on the door of the Congress, it is worth mentioning that this happened post July 2014, after the NDA government came to power in Delhi,” he said.

Records fudged

The bank authorities reported the irregularities to the Finance Ministry soon after the irregularities were detected. An internal inquiry revealed that records were fudged to evade detection. Entries were made showing dollar-rupee exchange rate as Rs.0.0001 instead of the then prevailing rate of Rs.60 per dollar. Besides, all remittances were kept below $1,00,000.

The audit report accused the bank officials of not applying due diligence while allowing advance payment of huge amounts of remittances to exporters.