India claims success in unearthing trade-based money laundering

India’s Enforcement Directorate(ED) says it is successfully detecting trade-basedmoney laundering (TBML).

In its latest case, the directorate says it has so far unearthed evidence that foreign exchange dealer, Manish Jain, fraudulently channelled the equivalent of $15 million via nine major national and international banks, with illegal remittances being sent to Hong Kong and China.

Case history

The case emerged out of a separate inquiry into fraud at Bank of Baroda where suspicious remittances of an estimated $200 million are under investigation.

The ED alleges that Jain originated illicit funds flows in Uttar Pradesh where he held 66 different accounts in various names at a branch of Oriental Bank of Commerce.

The funds were subsequently sent to an HSBC bank branch in Hong Kong and then to China, apparently settling purchases by various importers in India buying from Chinese suppliers.

False documents

Investigators say several other Indian banks may have been used by the accused, who operates two firms dealing in foreign exchange in Hong Kong.

The ED alleges that Jain used false documents to dupe banks into providing trade finance facilities even though no physical shipments of goods were made.

Categories: Trade Based Financial crimes News

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