Srinagar, May 15: The Army busted a hawala racket responsible for bringing money to militant outfits operating in the Kashmir valley from Pakistan-occupied Kashmir (PoK) through Karvan-e -Aman bus.
A defence ministry spokesman said a tip-off was received that funds for militant organisations from PoK was being brought by some passengers of the bus, operating between Srinagar and Muzaffarabad.
He said 19 Infantry Division of the Army mobilised all its ground resources to bust the racket.
The breakthrough was achieved on May 13 when they were able to recover Rs 1.5 lakh from a Pok passenger Mufad Ali, hailing from village Pahl.
Giving details about the operation, he said, a team of officials from intelligence agencies closely watched the movements of Ali who had arrived at Sultan Deki on May 8.
The troops finally arrested Ali when he was about to hand over the money to one Hafiz Ullah, a resident of Warpora, Sopore.
Initial investigation in the case said it was a large network of over ground workers who were involved in money transactions from across the Line of Control for militant organisations operating in Jammu and Kashmir.
Hafiz admitted that he had collected the money on behalf of Fayaz Ahmad War, a hardcore militant.
He said they were also dealing in illegal transactions of foreign currency, drug trafficking and supply of fake currency.