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Bogus exporters facilitate hawala in Kerala

By G. Anand

THIRUVANANTHAPURAM, OCT. 28. Fly-by-night export-import businessmen in Kerala who misuse export incentive schemes are increasingly becoming key conduits in the illegal and largely-anonymous money transfer practice known as hawala.

The Directorate of Revenue Intelligence (DRI) has found that hawala dealers in the Gulf are using the bank accounts of certain "bogus exporters'' in Kochi and Kozhikode to transfer money to their agents here.

The exporters are made to send cheap goods to foreign countries and quote exaggerated prices for them, often on the basis of bogus export orders. The hawala dealers then transfer huge amounts to Kerala through the bank accounts of the exporters, as the price of the goods sold.

Suresh Jain of Sweety Exports, Mumbai, who is currently under detention in connection with the Directorate of Enforcement (DoE) probe into the Rs.640-crore hawala case, had been probed by the DRI in connection with the fake export of "coloured water" as ink of high value. Jain had been accused of claiming Rs.18 crores as export incentive on the "fake" consignment.

Misusing concessions

The DRI had also found that the black hawala trade was misusing the Export Promotion Capital Goods Import Facility that allows export-oriented manufacturing units to import machinery without duty. Hawala dealers buy and import such machinery duty-free and then sell them for huge profits that are then used to compensate their agents in Kerala.

A large number of hawala transactions in Kerala still are "routine ones," essentially involving transfer of remittances of non-resident Malayalis to their relatives in Kerala.

The hawala dealer compensates his agent in Kerala over a period of time through myriad ways, including smuggling. Recently at Kozhikode airport, the DRI booked a person on the charge of smuggling a chemical in high demand for making herbal preparations. Electronic components, gemstones and gold bought with hawala money from foreign markets are also sneaked into the State to compensate the hawala agents here.

Many takers for hawala

What is worrying enforcement and police agencies now is that such traditional hawala routes in the State are increasingly being used also by money launderers, drug dealers and anti-national elements. A Narcotic Control Bureau official said illegal hawala channels in Kerala were being used to bring in drug money. The money from the sale of heroin smuggled out to the Gulf countries, particularly Saudi Arabia, is "laundered" through such channels.

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