The crackdown on black money continues, and this time the Enforcement Directorate has tracked down Rs 93 lakh in new currency notes in Karnataka, arresting seven alleged middlemen.
The Prevention of Money Laundering Act (PMLA) comes in handy in putting behind bars the accused, one of whom in this case happens to be a government official.
In this case, the ED officials garbed them as ‘customers’ who look to exchange old currency illegally, after paying the agent his due commission. This is the most prominent modus operandi among the law keepers, as this honey trap becomes impossible for the agents to reject.
This new seizure is another addition to a chain of other confiscations, throughout the country by other law enforcement bodies. This shows a clear nexus of middlemen with senior bank employees. According to a report by Indian Express, these middlemen offer the bank employees 15 to 35 percent commission depending on the amount to be exchanged.
Around Rs 250 crore has been confiscated till date in new notes from agents by carrying out multiple raids across the country. The Home Ministry is aware of this evil, and is keeping close tabs on all nationalized as well as private banks.
On Wednesday, the list of unclaimed bank accounts released by Switzerland enlisted at least four names of Indian individuals. The bank contains more than 2,600 accounts and 80 safe deposit boxes.
Although specific details of those accounts were not disclosed, they however, have an estimated holding of almost 44 million Swiss francs (about Rs 300 crore).
Out of the four individuals, Pierre Vachek and Bahadur Chandra Singh are from Mumbai and Dehradun respectively, and Dr Mohan Lal lives in Paris. The residence of Kishore Lall, the fourth person, however was concealed.
“The number of names published in December 2015 is just over 2,600; connected to these names, there are currently assets of around CHF 44 millions. Additionally, around 80 safe-deposit boxes are currently published,” said the Swiss Bankers Association (SBA). SBA and the Swiss Banking Ombudsman later announced that the heirs or relatives of these individuals have five years to submit their claims for the accounts.
By publishing of the list, Switzerland has provided an opportunity for the owner’s heirs to claim the funds in the accounts. This clause applies to only those accounts that consist of at least 500 Swiss francs and have remained dormant for over 60 years (since at least 1954).
Apart from Indians, this list includes names from Germany, France, Turkey, Austria, the UK, and the US, and several other countries.
A new law in Switzerland which mandates publication of the names of individuals possessing old inactive customer relationships annually is what initiated this list.
The Swiss Bankers Association said, “If no legitimate party claims the assets that have been published within one year of publication, the banks must by law transfer the assets in question to the government”.
The black money law that penalizes the concealment of foreign income and provides for criminal liability for attempting to evade tax on the foreign incomes of Indians was passed by Parliament on Wednesday July 1st this year, by Finance Minister, Mr. Arun Jaitley and government warning those having such assets to utilize the “compliance window.”
Those with unaccounted foreign assets won’t get the benefit of a one-time disclosure window under the new black money law if the government had prior information about this. This means that those already under investigation, such as people on the HSBC list, will be denied this leeway. The HSBC list refers to people and entities with accounts in the bank’s Geneva branch and was disclosed by a former employee.
Assets will have to be valued in general at cost or fair market value on the valuation date, whichever is higher, according to the rules. The government is giving black money holders one last chance to pay 30% tax and 30% penalty to escape the law that provides for imprisonment of three to 10 years for undisclosed foreign assets or income. He further made it clear that the new law will not cover those having amounts equivalent to Rs 5 lakh in bank accounts abroad which may belong to students or those working there.
The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Bill, 2015’, which is claiming to be a tough law to deal with Indians who keep black money abroad, the government has demonstrated that it has the political will to address the menace of black money.