The government is likely to conduct a through inquiry into the allegations that HSBC Bank was involved in money laundering which might help terror groups operating in India. The probe is likely to be conducted by sleuths of various intelligence wings of home and finance ministries, as the allegations, if proved true, would have serious security implications, highly placed sources said.
However, the sources said, it had nothing to do with activist Arvind Kejriwal’s allegations of money laundering against HSBC Bank.
The multinational bank had, however, yesterday denied the charges and said it took compliance with the law very seriously.
The probe agencies will look into reports that funds were being routed from Pakistan and a few Gulf countries to terror groups operating in India using banking networks.
Meanwhile, Home Minister Sushilkumar Shinde on Saturday said the government had information that terror groups operating in India and outside the country were investing money in stock markets through various methods. “We have information that they have been putting in money in stock exchanges and stock markets. We have received information in international fora. We are keeping a track of them. They are investing in stock exchanges in India and some neighbouring countries,” he said at a press conference.
Early this week, addressing the Interpol General Assembly in Rome, Shinde had said stock markets had emerged as a new mode for terrorists to route their money into the country's economy and leverage it to carry out their nefarious designs. “It is a cliche to say terror-funding is the lifeblood of terrorism. Credible intelligence suggests that terrorist outfits are investing in stock markets through spurious companies, setting up fictitious businesses and laundering money," he said.
Sources said the information came following arrest of a few couriers who had confessed that money was being sent from Gulf countries through Western Union money transfer. In September, market regulator Securities and Exchange Board of India had said 35 stock brokers have been probed by it for possible lapses in controls related to money laundering and terror financing. The inspections by SEBI followed actions taken by stock exchanges and depositories against more than 300 market entities for violations and discrepancies related to Anti-Money Laundering and Combating Financing of Terrorism (AML and CFT) regulations in the 2011-12 fiscal. Last year, government had told Parliament that it has received information about 10 suspected instances of terrorist financing using the stock exchanges between 2009-11. The Financial Intelligence Unit had received five suspicious transaction reports (STRs) during the 2009-10, four during 2010-11 and one case till November 2011. The STRs, suspected to be linked to terrorist financing, have been received from intermediaries of stock market such as stock brokers, asset management companies, etc, and disseminated to intelligence agencies by the FIU.
The contract has been put on hold and further payments have been stopped
SC Bench allows petitioner Ram Jethmalani to interact with SIT