Yunus Ansari, who was freed from Kathmandu Central Jail just six months ago after serving a three-year sentence on a similar charge, was nabbed with the two others from his residence at Nakhipot in Lalitpur district near Kathmandu.
Nepal Police spokesman Ganesh Kesi said fake Indian currency with a face value of Rs 3.5 million was seized by a special police team that raided Ansari's home after getting a tip off.
Ansari is the son of former minister Salim Ansari.
In January 2010, Nepal Police had arrested Ansari with two Pakistani accomplices and a bodyguard in connection with a fake Indian currency and drugs racket having links to Dawood Ibrahim.
At that time, police recovered fake Indian currency with a face value of Rs 2.5 million and 3.7 kg of heroin from Ansari's bodyguard.
In March 2011, an alleged Indian gunman Jagjeet Singh had opened fire at Ansari inside the jail. Singh, who entered the prison in the guise of a visitor, shot Ansari once in the back.
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