One of those arrested came under the Income Tax Department’s scanner in August last year for throwing a “hawala” racket using shell companies.
The Department of Law Enforcement (DE) arrested two Chinese nationals for money laundering. They are currently in the custody of the agency.
The defendants have been identified as Luo Sang and Carter Lee. Sang had been scanned by the Income Tax Department in August last year for throwing a “hawala” racket using shell companies.
Based on the findings, the DE also opened an investigation under the Prevention of Money Laundering Act.
The IT department had detected the racketeering that allegedly involved Chinese companies using front entities for “hawala” operations in India. Searches were then carried out on the premises of suspects in Delhi, Gurugram and Ghaziabad.
The department focused on Sang, who lived under a pseudonym, Charlie Peng. The accused held a fraudulently obtained Indian passport, allegedly issued from Manipur.
According to the agency, Sang used a dozen bank accounts opened under fictitious names to channel funds. He has represented several Chinese companies in India for “hawala” operations.
“Based on credible information that certain Chinese individuals and their Indian associates were involved in money laundering and ‘hawala’ operations through a series of shell entities, a search action was organized in various premises of these Chinese entities, their confederate relatives and a couple of banks. employees, ”the ministry said.
The initial investigation found that at the request of Chinese individuals, more than 40 bank accounts were opened for various bogus entities, concluding loans of over ₹ 1,000 crore over a given period.
“A subsidiary of a Chinese company and its related concerns took back bogus advances of ₹ 100 crore from front entities for opening retail showroom businesses in India,” the ministry said, adding that the role of some bank managers and chartered accountants was also ongoing. investigation.