The revelation against HSBC has woken up the Indian agencies who have now put its India employees under the scanner. The Revenue Intelligence wing and also the Reserve Bank of India [ Get Quote ] will probe some rogue elements in the bank who could have possibly facilitated this offence which helped drug lords and terrorist groups park money by hoodwinking the security agencies.
This is, however, not for the first time that the HSBC has shown signs of vulnerability in its security set up. A couple of years back, police had picked up Nadeem Kashmiri, a HSBC employee, who was allegedly siphoning off funds to off shore accounts and also stealing data and providing them to some persons.
At the time of his arrest the police had said that he could be a pawn in a huge syndicate and was stealing confidential data of customers in Britain and passing it on to some persons who could have been misusing such data. It was also alleged that he had siphoned off funds to the tune of 2,33,000 pounds.
Sources in the Intelligence Bureau say that the case on hand and also that of Kashmiri's are quite different. However, the fact remains that there are such elements who commit such frauds and these are the kind of persons who could have helped some drug lords and terror groups set up accounts and go about their transactions.
While it is common knowledge that there are middle men who set up these accounts, the fact remains that unless and until there is an inner hand such transactions cannot be possible.
The Indian agencies will work closely with their counterparts in the United States of America for seeking details from the bank about some of the employees who have already been placed on the radar.
Those Indian employees who will come under the scanner may have not been directly aware of who exactly they were helping. It is usually made to look like an offence pertaining to black money and money laundering. Most of the time the employees would not be aware that this money is being parked by drug lords or terrorists. It is a well knit network and it happens on scales both big and small.
Sources say that it does not matter if these persons knew what the money was being used for, but the fact that they have overseen transactions in order to push their sale or for a bribe is a financial crime and can be tried in the Indian courts.
"India is extremely serious about such offences and has been fighting a major battle both against money laundering and also fake currency. Such employees are aware that such offences usually fall under the ambit of a fraud case which can be bailable after a certain amount of time," an IB source says.
However now the Indian agencies have proposed to amend the Unlawful Activities (Prevention) Act to combat this menace of money laundering. If the amendment comes through then money laundering would fall under a terrorism offence. In addition to this the proposed amendment also looks at widening the scope and bringing fake currency under the same ambit.
"If the amendment comes through then such offences on Indian soil is going to reduce a great deal. Most of these bankers may indulge in fraud for the want of some money, but if the offence is covered under terrorism then they would think several times," police officials say.
The other aspect would be to have a proper investigation and ensure that the guilty are brought to book. They would not want it to go the Nadeem Kashmiri way where a hue and cry was first made about his international terror links only to go slow later on the case for want of proper evidence.
Today the strongest case that the police have against Kashmiri is that he had forged mark sheets to get a job. It is hard to get proper evidence in such cases and hence the police are looking for a law that could act as a major deterrent, sources say.
The probe in the HSBC case is going to take months, Indian agencies point out. They are still in the process of identifying the accounts and also those persons who had dealt with them.
"Once the probe commences in full swing all those involved with a particular transaction and those authorities in charge of the branch could be made collectively responsible for the offence. It is a huge syndicate that not involves the drug lords and terrorists. Right from the middle men to those who facilitated this crime in the banks would all be probed and charged once the investigation is complete," an officer closely related to the investigation says.