The Incredible Banker (25 page)

'Hello,'

'Hey, Sharma. Andy here. No change. We go with the old front page layout,' he gave staccato instructions.

'Yes, sir...just in time. We were about to go ahead with the changed format.'

"Thanks, old man.' He kept the phone down and looked at Karan and Bhaskar. 'Well done! We will rock tomorrow.' Then he looked at Karan and asked, 'Are you scared, son?' Karan was stumped for a minute, wondering if he should really have been in the first place.

'Global Bank of Greater Boston involved in massive money laundering scam. Over 100 crore of money routed to fond Naxalite operations'

This headline on the front page of the country's most widely circulated daily really woke everyone in GB2 to a threatening reality. Ronald was shocked out of his wits when he saw the morninger. It was the same guy – Karan Panjabi – at work. He was now ruing those five minutes the previous morning when he had been extremely rude to him. Maybe this was what Karan had wanted to tell him about. But Ronald didn't allow him to speak.

He read the entire article again.

A massive money laundering scam, with far reaching consequences, has been unearthed by our correspondent today. It is suspected that over 100 crore of funds have been diverted to the Naxalites through the account books of Greater Boston Global Bank. While it is early to say if there has been any connivance on the part of the bank officials, the recent arrest of Deepak Sarup, an alleged Naxal sympathiser, does raise questions on the sanctity of the seemingly untouchable foreign banks in India.

The modus operandi followed here is very simple. A Naxal sympathiser sets up a company that acts as a front. The company acquires credit cards for its employees through a hungry and ever-willing bank, Greater Boston Global Bank in this case. The bank, in its eagerness to issue cards and meet its monthly targets, compromises on processes and documentation requirements and ends up issuing credit cards to benami parties, who don't exist at all.

These cards then are used by Naxal operatives to transact and buy weapons and food and groceries to feed their large contingents and troops. The transactions are smartly monitored by a cell of militants, who then inform the sympathisers pan India. This network of sympathisers then pay into the respective credit card accounts at various locations in cash. This too raises eyebrows because not a single payment into the 968 card accounts is of value more than
50,000. It may be prudent to point out that fifty thousand is the threshold beyond which one is expected to quote a PAN number while making a cash deposit and these transactions tend to get monitored by the tax authorities. The Naxalites have smartly ensured that cash payments into these cards never crosses
50,000, effectively laundering over 100 crore without getting noticed. While this does away with the requirement of quoting a PAN number while making cash deposits, any surveillance by the income tax authorities, on account of the customer spending more than 2 lakh a year is suitably nullified by the fact that the customer is non-existent. Who will the IT notice get served on?

Take the case of Francis D'Silva, the Naxal commander who was killed during the massacre of 55 innocent SPOs in the Ghauli forests in Ranibodli. A credit card with a credit limit of three lakh was recovered from his body.

A critical examination of the conduct of the card account in the last twelve months reveals that he has spent an average of one lakh every month. Payments have been made on time, every single month, always in cash.

What also surprises here is that while the customer, i.e. Francis D'Silva, was supposed to be based in Mumbai, the transactions were in Kolkata, Raipur and Chhattisgarh and the payments into Francis's cards have been made in cash at the branches of GB2 in Hyderabad, Chennai, Mumbai and even in branches like Thiruvananthapuram and Cochin. For instance on twenty-first of August, Francis spent
45,600 at a grocery store in Jamshedpur, and the same day a
48,000 cash deposit was made into the card account in the Kolkata branch. Such instances can be justified as a one-off, but if all transactions in Francis's account follow a similar pattern it leads to questions on the modus operandi and even on sources of these funds.

If one individual namely Francis has followed such a modus operandi, it can be termed as someone defrauding the bank. However if in all the 968 credit cards issued to benami employees of Symbiotic Technologies, a bogus company, the same modus operandi is followed, it points to a large scale money laundering scam.

Unaccounted cash from Naxal sympathisers made its way every month through this operation to fund the Naxalite war against the nation. The average money routed through each of these 968 credit cards was one lakh a month that makes it close to
9.7 crore to fund Naxals through this scheme. In twelve months the money which has changed hands is in excess of a hundred crore.

The most shocking lapse seems to be clearly on the part of GB2. Reserve Bank of India has stipulated that banks collect certain mandatory Know Your Customer (KYC) documents from customers before they open any account. The originals of these documents are to be sighted by the bank employee before any account is opened. This process needs to be followed for issuance of credit cards, too. However in the case of Francis D'Silva, the credit card seems to have been issued by GB2 based on the KYC document (passport) provided by his company, without a bank official sighting the originals. No verification of the residence address was carried out.

Alongside this article is attached a copy of the forged passport of Francis D'Silva, which formed the basis of the card issuance. The photo on the passport is completely different from the photograph of the individual who was killed in Ranibodli. (Real photo released by CBI in inset.) It is suspected that the entire lot of 968 cards issued to Symbiotic Technologies followed this lax process.

It is now clear that the cards delivered to the HR executive at Symbiotic Technologies, a fraudulent company, never reached the employees. In fact it was never intended to. In fact there were no employees in Symbiotic – there were only co-conspirators.

These cards made their way to the Naxals of central and eastern India and became a mode of laundering black money from sympathisers to support the Naxal cause. Arms were bought, food and rations were procured using the card as a front and the same was funded subsequently by unidentified Naxal sympathisers in cash. A brilliant game by the Naxalites to beat the banking system in the country.

This raises the following key questions:

1. Why did GB2 not follow laid down procedure on KYC when they issued cards to employees of Symbiotic Technologies?

2. Why weren't such large-scale cash transactions into a particular set of customer's credit card accounts identified through internal control processes of GB2?

3. Was GB2 only a conduit for routing of these funds or were employees of GB2 or the organisation itself a willing partner in the entire scam, in return for financial gains?

Most of these questions remain unanswered. However we are confident that as days go by and more data becomes available, we will be able to get to the bottom of this scandal, which threatens to rock the foundation of the world's largest democracy.

CBI today released two pictures of the alleged Naxal killed in the Ranibodli massacre. The picture on the left is the actual picture of the Naxalite while the one on the right is the picture as it exists in the passport of Francis D'Silva (courtesy GB2). CBI has requested that anyone with any information on the Naxalite should immediately contact the Anti Naxal Cell of CBI at 123455678. You may also contact the offices of this newspaper at 2222222222.

This newspaper headline created a furore both within and outside the bank. Within the bank, the entire PR machinery went into a tizzy. The reputation of GB2 as a compliant bank and as a solid process-oriented bank was shred to bits by the front page of
The Times of India
.

Ronald was livid. He was furious at his team, particularly Saurabh, Bhisham and the fraud team led by Inder, for not informing him at the right time. He was shocked that what they could not figure out with their massive databank was easily identified by someone from outside who had limited access to their data. "This is another failure of the India GB2 team,' he screamed. 'We have serious credibility issues in the region which have been aggravated by this report.'

He looked at Bhisham and said, 'I want the fucker who is responsible for this failure to be brought to task. Do you understand? I want heads to roll.' He then turned towards Inder. 'And, Inder, I want a complete report on Symbiotic from you. You have only twenty-four hours for it. Now come on, guys, time to get moving!' he shouted. Little did he know that Inder's report would say nothing different than what was already there in the papers!

Andy was extremely thrilled with the reaction to his morning story. He had gambled with the story. In fact his career was at stake. It could have backfired if it had turned out to be plain speculation. But it was Karan's conversation with Kavya which had convinced him about the veracity of the story. If even one of the credit cards that Kavya had checked had not followed the same transaction pattern, he would have withdrawn the story. With 20 random cards displaying the same transaction pattern, it was prudent for him to go ahead. In the worst case, he could have been pulled up for exaggerating the facts but no one could deny that there was definitely a huge problem which needed to be fixed.