30 people on HSBC list get ED notices

The Enforcement Directorate (ED), the agency investigating foreign exchange violation, has issued notices to 30 Indians whose names are on a list of account-holders shared by HSBC in Switzerland.

Confirming the development, the ED said, "The notices were served to the individual under Section 37 of Foreign Exchange Management Act (FEMA) seeking information on assets." Sources said the agency has asked the respective Swiss bank account-holders to disclose details of their domestic and overseas accounts from 2005 to 2015. The recipients of these notices are mostly based in Mumbai and Bengaluru.

An official said these people have a substantial amount in their bank accounts. "Attachment of accounts can be made in a bid to prevent siphoning of money to other friendly countries, before the investigation comes to a logical conclusion," said an ED source

The move came after a special investigation team (SIT) on black money had wanted these cases to be probe by the enforcement directorate for possible foreign exchange violations. The probe gained momentum recently when the Indian government started receiving a slew of information from authorities abroad, especially Singapore and Hong Kong.

Sources privy to the development said the situation has now changed and "we are finally obtaining data from various parts of the world which was so far restricted due to treaty obligations".

A highly placed sources said Singapore had recently shared a new list of 1,200 individuals across the globe; one-third of those were Indians. Around 200 individuals on the list were from Mumbai alone, and 20 per cent of them were non-resident Indians (NRIs).

"If the probe agency establishes the presence of unaccounted overseas wealth in these accounts, the account-holders would be liable for harsh action. With the new law, even an NRI status won't help," said a former senior I-T official on condition of anonymity.

A number of people on a list provided by the French government a few years ago, after the details were allegedly stolen by an employee, had seen charges slapped on them under FEMA and anti-money laundering Acts.

The income-tax department was investing the case and had launched prosecution against 140 individuals. So far, undisclosed income of more than Rs 3,000 crore deposited in foreign bank accounts has been brought under the tax net.

According to official data, 628 Indians were on the HSBC list; 200 were either non-residents or untraceable, leaving 428 actionable cases. The net amount of peak balance for these 428 cases was about Rs 4,500 crore, a government data had said.

The list that had come out in early 2015 featured names of 1,668 Indians while the number of actionable cases stood at 1,195, after taking into account duplication and other factors. Collectively, these accounts had a balance of Rs 25,420 crore till 2007. However, tax department already said it had the old data.