The truth is visible to everybody except the Government of India.
Instead of taking action it is hiding behind euphemisms like ‘secret, ‘bilateral arrangements,diplomatic relations’ etc.’
Story:
India’sunderground economy is closely tied to illicit financial outflows. The total present value of India’s illicit assets held abroad ($462 billion) accounts for approximately 72 percent of India’s underground economy. This means that almost three-quarters of the illicit assets comprising India’s underground economy—which has been estimated to account for 50 percent of India’s GDP (approximately $640 billion at the end of 2008)—ends up outside of the country. (vii, 19)
The finding that only 27.8 percent of India’s illicit assets are held domestically support arguments that the desire to amass wealth illegally without attracting government attention is one of the primary motivations behind the cross-border transfer of illicit capital. (vii, 19)
In the post-reform period of 1991-2008, deregulation and trade liberalization accelerated the outflow of illicit money from the Indian economy. Opportunities for trade mispricing grew and expansion of the global shadow financial system—particularly island tax havens—accommodated the increased outflow of India’s illicit capital flight. (Introduction)
There is a statistical correlation between larger volumes of illicit flows and deteriorating income distribution. (35)
Recommendations.
Tax evasion is a major component of the underground economy, which in turn is a primary driver of India’s illicit outflows. Expanding India’s tax base and improving tax collection has high potential to curtail illicit flows.
Illicit financial flows cannot be curtailed without the collaborative effort of both developing and developed countries. Economic reforms key to stemming the outflow of illicit money from India and the developing world in general include:
curtail trade mispricing (a widely utilized tax avoidance technique of international businesses);
New York —Nigeria might have lost $130 billion from 2000-2008 to illicit financial flows, a new report issued by US-based group, Global Financial Integrity, GFI, said.
The report entitled “Illicit Financial Flows from Developing Countries: 2000-2009,” said Nigeria had the 10th highest measured illicit outflows in the developing world, an average of $15 billion per year.
The North America Correspondent of the News Agency of Nigeria, NAN, reports that the GFI report ranks countries according to magnitude of illicit outflows.
According to the report, China is ranked the highest country of measured illicit outflows in the developing world with 2.18 trillion dollars, followed by Russia; 427 billion dollars and Mexico, 416 billon dollars.
The report also shows the annual outflows for each country and breaks outflows down into two categories of drivers: trade mispricing and “other,” which includes “kickbacks, bribes, embezzlement, and other forms of official corruption.”
Others in the top 10 are Saudi Arabia $302 billion; Malaysia $291 billion; United Arab Emirates $276 billion; Kuwait $242 billion; Venezuela $157 billion and Qatar $138 billion.
Primary findings from the report said illicit outflows increased from $1.06 trillion in 2006 to approximately $1.26 trillion in 2008.
How can one expect that Truth will come out in 2G and S Band Scam?
What is distressing is that the BJP has failed to unearth the sordid details.
It makes one wonder about the protestations by the opposition parties when they are not in power .
All seem to be in cahoots.
JPC or not, the show of inquiry will go on and nothing will come out of it.
Story:
The greed of Sonia Gandhi and her family has crossed all bounds of decency.
With just three weeks to go before the Congress-led UPA government’s term ends, Ottavio Quattrocchi, the lone surviving suspect in the Bofors payoff case, no longer figures in the Central Bureau of Investigation (CBI)’s list of wanted persons.
The 12-year Interpol Red Corner Notice (RCN) against the Italian businessman has been taken off the “Interpol Notices” section of the agency’s website.
Bharatiya Janata Party (BJP) Tuesday said it was a “farewell gift” from the Congress-led government to a “close friend” of party president Sonia Gandhi.
CONGRESS PARTY – SHOVING BOFORS AND “Q” CONNECTIONS UNDER THE CARPET
In an article written on March 18th 2009: INDIA has $1.4 Trillion of Illegal money stashed in Swiss Banks – Time to bring it home !, I wrote in the first para: “Rajeev Gandhi’s untimely death left Sonia Gandhi extremely wealthy. The true extent of her wealth became known only when the Soviet archives were thrown open following the collapse of the Soviet Union. KGB archives revealed that as far back as 1982, when Indira Gandhi was still prime minister, Soviet trading agencies were channeling funds into a company controlled by her son and future Prime Minister Rajiv Gandhi.
This was also brought to light by Harvard Russian scholar Yvgenia Albats in her book The State Within A State: The KGB and Its Hold on Russia. The Swiss news-magazine Schweizer Illustrierte (November 11, 1991) provided more details. Citing newly—opened KGB records, it reported that Sonia Gandhi, widow of the former Prime Minister Rajiv Gandhi, was controlling a secret account worth 2.5 billion Swiss francs (about 2 billion dollars at current exchange rates) in a Swiss bank in her minor son’s name.
“Dr. Yevgeniya Albats is a Soviet journalist who was appointed as member of the official KGB Commission set up by President Yeltsin in 1991. She had full access to secret files of the KGB.
PAYMENTS TO GANDHI FAMILY AUTHORIZED BY RESOLUTION IN RUSSIA:
Dr. Albats disclosed in her book that KGB chief Victor Chebrikov in December 1985 had sought in writing from the Central Committee of the Communist Party of the Soviet Union (CPSU), ‘authorization to make payments in US dollars to the family members of Mr. Rajiv Gandhi, namely Sonia Gandhi, Rahul Gandhi and Ms Paola Maino, mother of Sonia Gandhi.’
CPSU payments were authorized by a resolution, CPSU/CC/No 11228/3 dated December 20, 1985; and endorsed by the USSR Council of Ministers in Directive No. 2633/Rs dated December 12, 1985. These payments had been coming since 1971, as payments received by Sonia Gandhi’s family, and ‘have been audited in CPSU/CC resolution No. 11187/22 OP dated October 12, 1984.’
How precise must one get to book the guilty? These are official KGB records.
INDIAN ATTITUDE AT G-20: LUKEWARM TO FRENCH PROPOSAL
The Indian delegation attending G-20 summit did not seem at all keen on supporting the French demand to make tax havens transparent and create a new global financial architecture that has more regulation.
Prime Minister Manmohan Singh‘s reaction to the growing chorus for getting back ill-gotten wealth, squirreled in tax havens, has been quite casual. This makes it quite clear that he would not back the demands of French President, Nicholas Sarkozy, and others to regulate and tame the global financial system ahead of any coordinated stimulus.
Indians, Swiss bank sources claimed in 2006, have more than $ 1.4 trillion squirreled in their bank vaults. This figure could reach astronomical levels if the funds of Indians in other tax havens are added up. Experts estimate that the total quantum of money that has flown out to safe vaults abroad could go beyond $ 2-3 trillion dollars. So substantial is this amount that if it returns to India then it could make a serious difference in alleviating poverty and transforming its inadequate infrastructure. More importantly, it will also bring out in the open the identity of those who perpetrated this organised loot for so many years. Most of the illegal funds are sourced from defence deals, corruption and large scale siphoning off from development programmes. If the details of the Swiss bank account holders ever come out in the open, it will be a fascinating story of how India has been pauperised by its ruling elite.
CURIOUS CASE OF BILLIONS IN PUNE STUD FARM:CLOSE RELATIVE WITH CLOSE TIES WITH RULING PARTY !
For more than three years now, INDIA have not been able to make much headway in tracing the $ 8 billion found in a mysterious Pune-based stud farm owner’s account in UBS, Switzerland. The money trail led to Virgin Island and to Saudi arms leader, Adnan Khashoggi, but the enforcement agencies have drawn no conclusions as one of the partners of the stud farm owner is a close relative of a big business family with close ties with the ruling party. This old business family, besides other interests, also serves as agents of some arms manufacturers. The belief is that pressure from this powerful group has prevented government to take its probe with the UBS to its logical conclusion.
However, after UBS wilted under US pressure to release the details of their nationals that evaded tax and parked their funds with them, there has been a flicker of hope in other countries too, that such details may finally see the light of the day. Indians have not shown much urgency in following up on US government’s enterprise- due a host of reasons.
This is election time in India and a wrong time to follow bad money. Indian elections are funded through black money and a lot of cash sitting in foreign bank accounts returns through the hawala route.
DOMESTIC POLITICS: CONGRESS MAKES MONEY HERE TOO (and so does all other political parties too!)
Even in domestic politics it seems the Congress Party (referred to as Palm party) has made money making an art. The article by Maloy Krishna Dhar clearly alludes to a chain of command of making money .Maloy Dhar writes: What you have given here is the darshan money ( BuA: Indian word meaning giving money to someone just to see a person). It qualifies you to be short listed and your name to be forwarded by the Pradesh party to the High Command (HC). The High Command (whosoever it might be) would be the final arbitrator. The HC is helped by A, B. C. & D (no name please).
Once your name is forwarded, go over to Delhi with a few supporters meet A, B, C, & D with adequate lubricants. Carry trunk full of money. Do not forget to meet X Patel. He is the conscience keeper of the HC. Satisfy him with the demanded amount. The final satisfaction lay with the HC. If you have any conduit to reach the HC, spend lavishly and reach there. The entire process may cost you rupees 10 million (= Rupees one crore).
(BuA: Mr X Patel – hmmm, who can that be – Sonia’s close confidante – AHMED PATEL??, HC = High Command a possible reference to SONIA GANDHI).
It’s India’s money that has been looted by foreigners and corrupt middlemen and most treasonously – by the executive branch of defense department of Govt of India. For every sub-standard defense procurement, look no further than the tax havens abroad where our politicians have stashed our hard earned money for their family. I will certainly not tolerate a flight of my country’s capital by foreigners – again !
At a time when our poor farmers are languishing in debt burden and economic crisis is hurting the average Indian – this illegal money stashed abroad is making us seethe in anger.
Unwinding of tax havens, MANY OF THEM UNDER THE CONTROL OF THE UK GOVERNMENT, would ensure that the development funds marked for the poor in Africa, Latin America and Asia do not find their way to the safes of banks in foreign countries. After all, many of the multinational banks have been recipient of drug money and kickbacks. History would bear testimony that some of the money in these banks have origin in opium. The world would be a different place when arms dealers, mercenaries and war-mongers, drug dealers have no place to hide their cash. Surely, this would impact terror funding, covert wars and so much of misery that this unaccounted wealth heaps on the poor of the world.
ISRO claimed that no transaction has been involved.
No monetary gains for Devas.
Then how come their shares are off loaded toa Foreign investor at a premium?
And why would a German Telekom be interested in the deal?
ISRO declared that they have the sanctions from the government right from PMO.
Does it mean the Govt. is stupid enough to okay a deal where they have no intention of allowing the companies to profit?
What message does it send to Business?
Telecom minister Kapil Sibal may soon find himself in a similar tangle as his predecessor A Raja. A spectrum deal between the Indian Space Research Organisation (ISRO) and Devas Multimedia Private Ltd., which has reportedly caused an estimated loss of Rs 2 lakh crore to the exchequer, was approved by the Union Cabinet based on a note signed by Sibal, who was the then Minister of State for Science and Technology.
ISRO had allotted 70Mhz of scarce S-band spectrum to Devas Multimedia – floated by former ISRO Scientific Advisor MG Chandrasekhar – at a dirt cheap price of Rs 1,000 crore in 2005, compared with Rs 1.06 lakh crore received after 3G spectrum auction.
If Sibal, who is trying to rescue the government in the 2G spectrum scam, is found to have played a prominent role in the deal, it spells more trouble for the Prime Minister’s Office (PMO).
Sibal, as a member of the Space Commission in his then capacity as Minister of State for Science and Technology, had sent a note that the deal was sealed by the Union Cabinet in 2005. Former Cabinet Secretary and the then National Security Adviser (NSA) MK Narayanan, now West Bengal Governor, and then ISRO Chairman G Madhavan Nair were other members of the commission.
Sources said Prime Minister Manmohan Singh was briefed by Cabinet Secretary KM Chandrasekhar last year on the need to cancel the ISRO-Devas deal. The Department of Space under Singh, however, did not order the cancellation. Even the Law Ministry last year, in response to the cabinet secretary’s query, had argued that ISRO was within its rights to cancel the contract signed on its behalf by its commercial arm Antrix Corporation Ltd.
Devas Multimedia, the alleged beneficiary of ISRO, causing loss of over Rs 2-lakh crore to the national exchequer, was able to raise over Rs 600 crore only as equity from various sources after it was allotted scarce S-band spectrum. ISRO is under the Department of Science and is directly in the Prime Minister’s charge.
According to the balance sheet of the company, the total shreholder fund stood at Rs 67.5 crore as on March 31, 2007, which went up to Rs 578 crore in 2010, over eight fold jump in a short span of only three years.
The company has shareholding from three Mauritius based companies called—Devas Mauritius, Ltd, Telecom Devas Mauritius Ltd besides Deutsche Telekom Asia Pte Ltd.
Devas Multimedia has several directors from overseas and other shareholders and debenture holders in the company, which were given approval post facto, suggesting that certain foreign investment rules were overlooked. Above is the shareholders list, their addresses, board of directors and sources of the fund of the company as on March 31, 2010.
The Mauritius based companies — Devas and Telecom Devas, were issued convertible cumulative preferential shares on March 16, 2006 at a huge premium of Rs 21445.82, only a few months after the company was allotted scarce spectrum.
Since the allotment of the scarce S-band spectrum, the company has been able to raise several hundred crore and has also made investments in various mutual funds and in foreign and financial institutions. The company has also loss making US-based companies as subsidiaries.
According to reports, as per its agreement with ISRO, the company is entitled to get a total of 70 Mhz of the S-band spectrum on lease for 20 years. And this is for the first time that the scarce spectrum, which ranges from 2500 to 2690 Mhz, has been given to a private sector company.
Seems that this is a plant to let the real culprits get away;typical Black Operation.
The money the accounts are supposedly holding, at least the Trusts, as CNN IBN points out is negligible when compared to the scams unearthed.
It is almost two years since the German Government had passed on the names and bank account details of eighteen Indians who had stashed their alleged ill-gotten wealth in the LGT bank of Liechtenstein, a well-known tax haven nation, 190 km from Munich, Germany.
TEHELKA has accessed 16 of the 18 names, of which we are putting out 15 right now. These names include individuals as well as trusts. At this point, we are putting out 15 names without disclosing details like their addresses, the businesses they are involved in and the total money they have stored away in Liechtenstein. Abiding by the basic journalistic principle of proving the accused an opportunity to present their side of story, TEHELKA has approached each of these individuals involved and is awaiting their response.
Once these individuals respond, we shall share the full details of who these people are and what they do. We shall also put out their responses. This, then, is the list.
The three trusts in this list are registered outside India.
The government has been claiming so far that a detailed investigation into all the bank account details provided by Germany is underway and making the names public would violate the agreement between two sovereign countries, India and Germany.
According to highly placed sources, the investigation into the 15 names that TEHELKA is disclosing, is close to completion and the Central Board of Direct taxes would soon prosecute these trusts and individuals under the relevant provisions of the Income tax Act.
The sources told TEHELKA that the two main charges proved against these individuals are of tax evasion and concealment of income.
The authorities also believe that some of these account holders could be fronts for high profile individuals. One name in particular is being investigated for suspected links with a well-known Indian politician.
The name of the chairman of a major Indian corporation is also part of the list, but TEHELKA is holding back his name until we have his full version.
According to Pranab Mukherjee, the German Government has provided the information under the strict confidentiality clauses of the Double Taxation Avoidance Agreement, and hence they could not be disclosed at the stage of investigation.
However, once the government launches prosecutions, the name would be made public, he had said.
These 18 names are part of the list of 1,400 clients, which were stolen from the databank of LGT Group, the Liechtenstein bank owned by the principality’s ruling family, and passed on to German tax authorities in 2008.
The German government had paid as much as €5 million, or $7.4 million, for information on German account holders in Liechtenstein on a disk provided by an informant to the German Federal Intelligence Service, or BND.
After this, Germany and England had launched massive investigations into the suspected tax evasions and have since prosecuted dozens of their citizens on charges of tax evasion and concealment of income.
The German Government alone had initiated action against over 600 of its tax payers.
Besides taking action against its own citizens, the German Government had also shared this information with other countries including India.
Prime Minister Manmohan Singh: “Investigations are on”
But the Indian names figuring in LGT Bank list are only a tip of the iceberg. Experts estimate that Rs 65 lakh crores of ill-gotten wealth earned by Indians is stored in Swiss banks alone.
According to R Vaidyanathan, Professor of Finance at the Indian Institute of Management, Bengaluru, the average amount stashed away by Indians in offshore tax havens between 2002 and 2006 was $136.5 billion. “These illegal funds lying in tax havens are not just related to the issue of tax evasion. It is capital flight from India and part of a corrupt nexus between politicians, bureaucrats and corporate companies,” says Vaidyanathan.
Different Indian governments over the past 20 years have done little to bring this money back by making necessary changes in existing Indian taxation and foreign exchange management laws.
Besides, the government has been slow in renegotiating double taxation avoidance treaties with different tax havens and making provisions for clauses under which the governments and banks could be compelled to disclose the account details.
For instance, under the existing Indo-Swiss Double Taxation Avoidance Agreement (DTAA), information on the Swiss bank deposits of Indian residents could not to be revealed until the Indian Government furnishes evidence of criminality behind these banking transactions.
Pranab Mukherjee: “We can’t reveal the names”
India enters into DTAAs with other countries to encourage flow of foreign capital and technology, and also to check tax evasion. The purpose of a DTAA is to mitigate the hardship caused by dual taxation on the same source of income. Double taxation on a single source earned by an individual is possible under income tax, as taxation depends not on citizenship, but on residential status.
To date, India has signed comprehensive double taxation avoidance agreements with 77 countries.
“I have asked the revenue department to reopen negotiations for all 77 double tax avoidance agreements with all countries that we have entered into so far, so that we can have real time exchange of information on tax evasion and tax avoidance,” Mukherjee had said at the India Economic Summit in November 2009.
Since the recession hit the economies of developed countries, the Organisation for Economic Cooperation and Development (OECD) has been leading a campaign for transparency in the international banking system, and making the tax havens to necessarily exchange information with other countries where tax evasions are involved.
The US in particular has been proactive in using the might of its economy to make different tax havens fall in line, and share the names of US citizens who have deposited money in these tax havens.
For instance, the UBS Bank, a Swiss bank and the world’s largest wealth management company, came under US scrutiny in June 2008 to uncover the identity of US nationals who maintained secret accounts in the bank and were defrauding the American revenue department.
When the US Government threatened to prosecute the USB Bank, the bank paid a fine of $780 million and also agreed to reveal the details of the hidden assets of US nationals within a fixed time frame failing which it would face prosecution.
The magazine claimed that the name of the chairman of a major Indian corporation is also part of the list, but it is holding back his name until they have his full version.
It is curious that the magazine should talk about 18 when the government had admitted before the Supreme Court that there were 26 such names.
A TV channel put out its own list, claiming that the list which was officially handed over to the Indian Government on March 18, 2009 includes 12 trusts and 26 beneficiaries.
The channel claimed that the list that Germany shared with India had 12 trusts out of which four belong to Indians.
The individuals listed by the channel included the following names:
Ishwerlal Gandhi
Madhu Gandhi
Mirav Gandhi
In addition, one of the names Chintan Gandhi was repeated twice in the TV channel’s list. So that makes a total of 15 (12 by the magazine + 3 by the TV channel) out of the 26 individuals, leaving out the suspense on the other 11, which clearly would be more prominent names
The TV channel also listed the following trusts as belonging to Indians which are included in the German list:
Ambrunova Trust
Marline Management SA
Marnichi Trust and
Socalo Stiftung.
But the channel added that the money in the trust accounts totals to just Rs 52 crores. Clearly, the individuals concerned also would not let the money lying there, and the mystery over the 11 names therefore assumes even more importance because someone out there wanted some names revealed but at the same time ensured that others were kept hidden.
Another TV channel is providing account numbers and claims to have linked three of the Mehta names to the IPL Kochi bid.
New Delhi: CNN-IBN has accessed the list of Indians who hold accounts with Bank of Lichtenstein.The list which was officially handed over to the Indian Government on March 18, 2009 includes 12 trusts and 26 beneficiaries.But the money in the trust accounts totals to just Rs 52 crore – is this a black money whitewash?
The list that Germany shared with India had 12 trusts out of which four belong to Indians.
CNN-IBN has accessed the details of 13 beneficiaries in the four trusts which are the Ambrunova Trust, Marline Management SA, Marnichi Trust and Socalo Stiftung.
And list the beneficiaries include Hasmukh Gandhi, Ishwerlal Gandhi, Madhu Gandhi, Chintan Gandhi, Mirav Gandhi, Manoj Dhupelia, Rupal Dhupelia, Mohan Dhupelia, Chintan Gandhi, Dilip Mehta, Arun Mehta, Arun Kochar, Gunwanti Mehta, Rajnikant Mehta, Prabodh Mehta and Ashok Jaipuria.
Enforcement Directorate sources have told CNN-IBN that the accounts are fronts for some powerful people.
With one determined stroke, he has cut the Gordian knot of secrecy and corruption that define the bureaucracy in the public mind. The CCTV cameras installed in his chamber are linked to Bescom’s website, and anyone can go online and see what the MD is doing at any time of the day — be it meeting politicos or his officials, or even having his lunch!
All that one has to do is go to www.bescom.org and click on the link, ‘view of MD chamber’, to catch the ‘action’ inside Manivannan’s cabin in the power utility’s office at K R Circle. Two cameras strategically fitted into the ceiling capture every movement inside the cabin. The footage is available in real time on the website. The move is reportedly the first step by the engineer-bureaucrat in making Bescom more consumer-friendly while emphasising its public obligations under the Transparency Act.
“Most IAS officers do not even keep their cabin doors open. Some others, including those with the Lokayukta, have spy cameras fitted in their chambers to nail those who offer them inducements. But Manivannan is the first to allow the whole world to see all that transpires in his cabin,” said an admiring Bescom junior engineer.
Throughout his career, Manivannan has had a reputation for honesty and sincerity — the very attributes that have made his transfers controversial. His transfer from the Hubli-Dharwad Corporation evoked public protests, while his transfer from the post of Mysore DC led to street demos by students and other citizens. One politico who has realised his true worth is energy minister Shobha Karandlaje. As in-charge minister of Mysore district earlier, she had a first-hand knowledge of Manivannan’s capabilities. Not willing to lose a gem of a bureaucrat, she roped him in as soon as she landed the energy portfolio.
For other Bescom offices too A senior Bescom official told Bangalore Mirror, “The idea is to install these cameras in all Bescom offices, and we have started by installing them in the MD’s cabin.”
Another official said, “When you know that somebody is watching your actions, you will be more cautious. After all, we are government officials and have to be accountable to the public.”
The two cameras diagonally opposite each other provide a view of the entire chamber. Thye have been installed at a cost of Rs 18,000 and have an ethernet link.
“Most IAS officers do not even keep their cabin doors open. Some others, including those with the
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