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ED registers case under PMLA in China hawala scam


New Delhi, Aug 17: The Enforcement Directorate has registered a case in connection with the China hawala scam.

The case was filed against Luo Sang alias Charlie Peng and others under the provisions of the Prevention of Money Laundering Act (PMLA) 2002.

ED registers case under PMLA in China hawala scam

It may be recalled that last week the Income Tax Department conducted raids against some Chinese individuals and their local associates for allegedly indulging in a money laundering racket involving Rs 1,000 crore using shell or dubious firms, the CBDT said.

Who is Charlie Peng, the alleged mastermind of the Chinese hawala racket in India

It said the "subsidiary of Chinese company and its related concerns have taken over Rs 100 crore bogus advances from shell entities for opening businesses of retail showrooms in India".

The Central Board of Direct Taxes (CBDT), that frames policy for the tax department, said the searches were launched based on credible inputs that a few Chinese individuals and their Indian associates were involved in money laundering and hawala transactions through a series of shell entities.

Some bank officials were also raided, it said.

"Search action revealed that at the behest of Chinese individuals, more than 40 bank accounts were created in various dummy entities, entering into credits of more than Rs 1,000 crore over the period," it said in a statement without identifying the entities involved.

"Incriminating documents of hawala transactions and money laundering with active involvement of bank employees and Chartered Accountants have been found as a result of the search action," it said.

Evidences of foreign hawala transactions involving Hong Kong and US dollars have also been unearthed, the CBDT said.

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