Breaking News & pinpoint loopholes exploited by black money hoarders

New Delhi, India – November 18, 2016: It may be an honest endeavor on part of the NDA Government to eliminate black money via currency demonetization. However, research done by and has revealed that black money hoarders are utilizing their ingenuity and loopholes in the system to convert their black money into legal tender. Some findings of the research are as follows:

Converting black money into gold and jewelry: In apparent collusion with jewelers, many black money hoarders are purchasing gold and jewelry. The old Rs 500 and Rs 1000 currency notes are being used for this purpose and everything works because jewelers are issuing back-dated bills of November 8 or prior to that. Such a jeweler will later deposit the old currency and show it as normal business income, earned on or before November 8. In this scenario, gold prices have risen considerably in recent times.

Channeling black money through Jan Dhan accounts: Jan Dhan accounts, many of which had zero balance earlier, have swelled up after the government announced the currency demonetization. Black money hoarders are apparently utilizing such accounts to park their black money. Even standard savings accounts are being used in a similar fashion to park black money. Those with black money are contacting relatives and associates to help convert their black money into legal tender. Commission in the range of 20-40% is being paid, wherever needed, for carrying out such transactions.

Forex Channels: Many foreign currency exchangers are doing brisk business, as they are also colluding with black money hoarders. They are selling foreign currency in exchange for the demonetized notes, at a premium of around 30-40 percent. For example, a US Dollar is being sold at around Rs 80 – 100, in exchange for the old currency notes.

Rural, non-digitized Cooperative banks: Cooperative banks, especially those that are not yet digitally connected to the banking system, are secretly accepting old currency notes and issuing back-dated Fixed Deposits (FDs) and Demand Drafts to influential people holding black money. At a later date, these FDs and Demand Drafts would be encashed in the new currency notes.

Property and land deals: Some real estate developers are offering special schemes to black money hoarders, wherein they can buy land or property, at a premium of up to 40 percent. For example, if a property costs Rs 100, black money hoarders can pay Rs 140 in the old currency notes and buy that property.

Luxury goods: Many black money hoarders are buying luxury goods such as expensive watches and precious jewelry. They may be doing it just to get rid of their black money or there may be an intention to sell these at a later data and get the new currency notes.

Money Mules: Several agents are working on behalf of black money hoarders to exchange their black money into the new currency. Such agents are repeatedly visiting various banks on a daily basis and are converting as much black money as they can. These deals are being carried out on a commission basis.

Railway tickets: Here also, agents are booking train tickets with the intention of cancelling them at a later date. This way, they will be able to get the refunds in the new currency.

If such transactions continue, they will nullify the potential benefits of currency demonetization. and would urge the government to look into these transactions and ensure that such loopholes are plugged at the earliest.

About Team | NewsPatrolling

Comments are closed.

Scroll To Top