How bank officials aiding tax cheats turn black money into white

NEW DELHI: On November 8, Prime Minister Narendra Modi announced that Rs 500 and Rs 1,000 denomination currency notes will cease to be legal tenders from the midnight as part of a string of measures to fight black money. While there is no respite in sight for cash-strapped people even after 34 days of demonetisation as queues outside banks and ATMs for money withdrawal continued across the country with rising anger and pain, on the other hand there are bank officials who are indulging in converting black money into white by misusing the banking system. Recently, the Enforcement Directorate has arrested two officials of a private bank in connection with its money laundering probe for alleged irregularities in the conversion of old currency and supply of new notes leading to black money generation. Modus Operandi- How it works

• There is a chain of agents involved in the exercise of illegally converting black money into white. It includes bank officials, agents and customers, and the commission amount, which varies based upon several factors, gets divided among them.
• "What matters is your relation with the bank manager. If he knows you well, then the chances of converting black into white are good," a person who was approached by an agent said.
• "Managers get a certain per cent of the amount so transacted through these banks as commission. Previously the rate was set to 60-40, now after a month it has come down to 80-20," the man told.
• Agents assigned by bank managers flood the poor people with offers to deposit money in old currency notes into their accounts. Which will be later exchanged with new notes at a commission for the account holders.
• At some places, bank officials are using the identity documents of various persons to open current accounts in their branch to facilitate the conversion of Black money into white. As the withdrawal limit of Current Accounts is more than that of savings accounts, a large amount can be withdrawn by the account holders.
•  There's a huge surge in total deposits in Jan Dhan accounts following demonetisation and a part of it is suspected to be black money being laundered. Bank officials are helping those with black money to stash their illegal wealth in Jan Dhan accounts to earn a fat commission. While the common man is struggling with cash crunch, a bank manager in Punjab opened about 150 Jan Dhan accounts of labourers overnight to deposit unaccounted wealth of tax cheats.

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