Customs unravels hawala trail in Kerala gold smuggling case

Investigators inspect house of Fazil Fareed, a suspect in the case

All-out effort: The police removing Youth Congress workers who breached the security ring and entered the Secretariat premises in Thiruvananthapuram on Wednesday demanding that Chief Minister Pinarayi Vijayan step down and face inquiry in connection with the gold smuggling case.

The Customs Department on Friday moved to track down the network of sponsors who had purportedly financed the illegal import of gold in trade quantities via air cargo shipments addressed to the consulate of the United Arab Emirates (UAE) here.

Investigators inspected the house of Fazil Fareed, a suspect in the case who was still at large, in Thrissur. They said they suspected that Fareed had handled the Dubai end of the operation.

His collaborators in Kerala, some of whom are now in judicial custody, had collected money to seed the smuggling run. The financiers included at least one jewellery shop owner and some persons with possible links to organisations that fronted for a proscribed fundamentalist outfit.

Sent to Dubai

Investigators believe the money raised in Kerala was sent to Dubai via an informal hawala banking system headquartered in Hyderabad. The accused had used the underground money transfer business to dodge banking regulators.

The operators at the Dubai end used the funds to purchase gold and convert the bullion into concealable form in cargo shipments addressed to the consulate. A tip-off had led the Customs to the contraband.

Customs enforcers have attempted to quantify the amount of contraband gold the smuggling network had illegally imported into the country in diplomatic air cargo consignments. The gang, which included two employees of the consulate, had raked in huge profits and used a part of it to fund a lavish lifestyle.

The role of the hawala operator and the likelihood that the secretive money transfer channel could be used to send cash to finance terrorist activities had kindled the NIA’s interest in the smuggling case. Hawala channels were also active conduits for laundering proceedings from illegal activities .

Customs enforcers said the return of a consulate official to Dubai did not have any bearing on the case. The mission had denied any knowledge or involvement in the crime and preferred a detailed statement. The mission had stated that it did not order the consignment and the documents were forged.