Investigators have found that these accounts were fraudulently opened under the names of unsuspecting individuals, primarily Hindu youths, and were used to accumulate substantial funds linked to terror financing intertwined with political networks. The funds were systematically transferred to multiple other accounts to obscure their origins.
The ED's probe has revealed that approximately ₹379 crore was withdrawn from these accounts, with a significant portion suspected to have been used for terror-related activities, including creating panic during assembly elections. Some of the funds were reportedly paid in cash to fundamentalist organizations to fuel religious propaganda, incite communal clashes, and orchestrate unrest among various social groups.
Further investigation has uncovered that around ₹114 crore was transferred from these 255 accounts to 19 accounts in Nashik Merchant Cooperative Bank and Bank of Maharashtra's Malegaon branch. These 19 accounts were fraudulently opened by the arrested accused, Siraj Memon, who allegedly used falsified documents to facilitate these transactions. Memon acted on the instructions of the arrested accused Nagani Akram Mohammad Shafi and the alleged mastermind, Mehmood Bhagad, also known as "Challenger King" or "MD," who is currently absconding and believed to have fled the country.
The investigation has also revealed that out of the ₹14.60 crore withdrawn by Memon and transferred through hawala operations, approximately ₹7.5 crore was routed to five Dubai-based firms:
1. Smart Care General Trading LLC
2. Seven Seas International
3. Kobalt Trading
4. Surya IT Solution LLC
5. Premium Information Technology Limited Company
These firms were registered under Memon's name; however, investigators suspect that Bhagad is the actual beneficiary. Bhagad, currently absconding, is allegedly linked to fundamentalist groups and is considered one of the key architects of this laundering scheme.
The ED has seized around ₹20 crore so far, and the investigation into the remaining ₹379 crore, suspected to be linked to potential terror activities, is ongoing. The agency is meticulously tracing the links between these accounts, transactions, and individuals, revealing a complex web of illicit financial flows designed to obscure the money trail.
This case highlights the challenges faced by financial institutions and law enforcement agencies in detecting and preventing money laundering and terror financing activities. The use of fraudulent accounts, shell companies, and international transactions to obscure the origins and destinations of illicit funds underscores the need for robust anti-money laundering (AML) and combating the financing of terrorism (CFT) measures.