The Enforcement Directorate (ED) has registered a money laundering case against a Chinese national for allegedly running a hawala racket worth an estimated Rs 1,000 crore using shell or dubious firms, officials said on Monday.
They said the central probe agency has pressed sections of the Prevention of Money Laundering Act (PMLA) against 42-year-old Charlie Peng, alias Luo Sang, who is alleged to be the kingpin of the racket.
Peng and some of his alleged associates, including Indians, and bankers were raided by the Income Tax Department on August 12. The taxman had searched at least two dozen premises, including that of Peng in Gurgaon.
The ED has taken cognisance of the tax department evidence and action and a Delhi Police Special Cell FIR against Peng before filing the criminal case of money laundering against him, they said. Peng, according to sources, is alleged to be holding a fake Indian passport and tax officials had said he created a "web of sham companies to launder hawala funds to and from China" in the past two-three years.
They said his front or showcase business was import and export of medical and electronic goods and some other items. Peng, the sources said, was arrested by the Special Cell of the Delhi Police in September, 2018 on charges of fraud and forgery and was allegedly running an illegal money changer.
It is alleged that Peng got a fake Indian passport from Manipur after marrying a woman from that state and some fake Aadhaar cards were also recovered during the raids against him. Peng is currently being questioned by the tax department apart from central intelligence agencies.
The tax department is searching dozens of bank accounts linked to shell firms in this case even as it has issued prohibitory orders against a number of these accounts. Both the I-T department and the ED, sources said, are also probing allegations if Peng was "bribing" some Tibetans living in Delhi for getting some work done from them.
The CBDT had issued a statement last week and without taking any names had said that the searches were launched based on "credible inputs that a few Chinese individuals and their Indian associates were involved in money laundering and hawala transactions through a series of shell entities." It had said the "subsidiary of Chinese company and its related concerns have taken over Rs 100 crore bogus advances from shell entities for opening businesses of retail showrooms in India".
"Search action revealed that at the behest of Chinese individuals, more than 40 bank accounts were created in various dummy entities, entering into credits of more than Rs 1,000 crore over the period," the CBDT had said. "Incriminating documents of hawala transactions and money laundering with active involvement of bank employees and Chartered Accountants have been found as a result of the search action," it said.
Evidence of foreign hawala transactions involving Hong Kong and US dollars have also been unearthed, the Central Board of Direct Taxes (CBDT) had said.