The Hindu : National : Hawala operations helping mafia, says Kodiyeri

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Wednesday, Jul 25, 2007
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Hawala operations helping mafia, says Kodiyeri

Special Correspondent

Police have definite information on hawala rackets
Nexus between racketeers, politicians and officials established

THIRUVANANTHAPURAM: Home Minister Kodiyeri Balakrishnan told the Legislative Assembly on Tuesday that hawala transactions of thousands of crores of rupees were taking place in the State annually, feeding a fast-growing network of mafia gangs.

Making a statement in the Assembly to apprise the members of the dangerous implications of the development, Mr. Balakrishnan said the police had received definite information that the hawala business was even linked to elements indulging in anti-national activities.

He said the police had information about the nexus one such gang, nabbed in Malappuram district recently, had established with politicians and officials.

‘Hawala’ is a term usually used for describing the racket involving the receipt of Indian rupee here, bypassing the approved banking channels, against foreign currency supplied outside the country. T

he hawala operators deliver rupee in India in excess of its exchange value against the foreign currency received by them outside the country.

“It has become clear that a very large network of hawala carriers covering the State in buses, cars and motorbikes is operating in our State … A parasite criminal community robbing hawala money from the carriers is also growing fast … It has come to the Government’s notice that even murders are being committed as a result of gang rivalries and disputes over sharing the hawala booty,” Mr. Balakrishnan said. Describing the details of the information gathered by the police so far, he said hawala business had become the conduit for circulating fake currency in the State.

He said the hawala operators, with their ill-gotten loot, were fast diversifying their activities to new areas of crimes.

He told the House that a special monitoring cell consisting of the Additional Director-Generals of Police for Intelligence, Crimes and Internal Security would start functioning immediately to plan and execute strong measures to check the hawala operations in the State. The Government would appoint a special squad led by Inspector- General of Police Vinson M. Paul to vigorously follow up the leads obtained by the police from the gang recently nabbed in Malappuram district.

He said the Foreign Exchange Management Act passed by Parliament in 1999 to replace the more rigorous Foreign Exchange Regulation Act that used to govern the flow of currency from abroad earlier had contributed to the growth of hawala business in the State. Actions on the basis of the Act now in force were to be taken by the Central Enforcement Directorate. Penal provisions in the present Act were an insufficient deterrent to the criminals, he said.

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