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Counterfeit notes thriving in city

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K. Satyamurty

A sizeable quantity of notes is believed to have originated from the Gulf

Police registered 115 cases in 2005 and the value of the notes seized totalled Rs. 60 lakhState fourth in circulation of counterfeit notes after Maharashtra, Andhra Pradesh and GujaratWithin Karnataka, Bangalore stands first, followed by Dakshina Kannada, Bellary and Mysore

BANGALORE: Along with software development and business process outsourcing, Bangalore may also be the centre for circulation of counterfeit currency. During 2005, the police seized 1,254 fake notes in Rs. 1,000 denomination and a larger number of notes in the smaller denomination. The total number of cases registered was 115 and the value of fake notes seized totalled Rs. 60 lakh. The figures were 47 and Rs 12.6 lakh in 2004, respectively.

According to police sources, counterfeiters are now going in for notes in the denomination of Rs. 1,000 rather than Rs. 500 or Rs. 100 as in earlier years. This is mostly because traders prefer transactions in larger denomination notes as they are easier to carry and count. Some counterfeit notes in circulation are the result of money doubling rackets, police say. On March 21, four persons from Kerala, two of them women, were arrested at the Bangalore City Railway Station when they were trying to make purchases at shops near the railway station using counterfeit Rs. 1,000 notes.

According to figures compiled by Central intelligence agencies, Karnataka comes fourth in circulation of counterfeit notes after Maharashtra, Andhra Pradesh and Gujarat. In Karnataka, Bangalore stands first, followed by Dakshina Kannada, Bellary and Mysore districts. Except for one case in Gulbarga, the police have no evidence of any fake notes being printed within the State.

Central intelligence agencies, who have been trying to trace fake currency, have reportedly come across evidence suggesting that a sizeable quantity of the notes may have originated from the Gulf region and Pakistan. Agents smuggling in such notes are paid commissions ranging up to 20 per cent of the notes they put into the system. Last year, the intelligence agencies reportedly cautioned the Reserve Bank of India about the circulation of fake notes in large denominations and this led to the security features on Rs. 500 notes being enhanced.

Over the past five years, the police say the trend is to counterfeit notes of smaller denominations as they are hardly ever looked at carefully. More money is in circulation, and cash is used even for major transactions. Thus, they may escape close attention.

A criminal offence

Since only a small number of fake notes are usually put into circulation, it is almost impossible to trace their origin, though under the law any person tendering a counterfeit note, even unwittingly, can be charged with a criminal offence.

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