Hawala is an illicit channel used for transferring money around the world by circumventing legitimate banking channels.The story of Kashmir terrorists being funded by Fai and his associates, London-based Ayub Thakur, who died in 2004, and Toronto-based Mushtaq Jeelani, lies buried in the infamous Jain hawala case, which raised a political storm in India in the mid-90s. Fai, director of the Kashmiri American Council (KAC), also known as the Kashmir Centre, was arrested recently for lobbying without registration by the US authorities. Apart from an office in Washington, the KAC has two centres in London and Brussels. According to the FBI, the centres were funded by the ISI.
Documents available with HT show that the Delhi Police picked up Uttar Pradesh resident Shahabuddin Gouri - linked to Fai and associates — from a Jawahar Lal Nehru University hostel in March 1991. Gouri was arrested on the basis of information provided by an alleged terror money courier, Ashfaq Husain Lone. The case was later handed over to the CBI and Enforcement Directorate (ED).
Investigations revealed that Gouri received around Rs. 16 lakh from alleged hawala dealer Shambhu Dayal Sharma on instructions from Fai and his associates. Gouri handed over the money to Lone who told investigators he had also spoken to Fai and Jeelani. He claimed that the money came from 'foreign donors who wanted to help the Kashmiri people suffering during their struggle'.
Investigators also got to know that Gouri had links with terror outfit Hizbul Mujahideen chief Syed Salahuddin, whom he met several times in Kashmir and Pakistan.
The ED also alleged that hawala dealer Sharma, from whom Gouri received money, was also dealing with SK Jain and JK Jain, the main accused in the Jain hawala case. All the accused were charged under the Foreign Exchange Regulation Act in 1996. Gouri pleaded guilty on all charges in 2002 and was sentenced to two years in jail. But as he had spent seven years in judicial custody, Gouri was released immediately.