ED struggles to find proof against Pune businessman | mumbai | Hindustan Times
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ED struggles to find proof against Pune businessman

mumbai Updated: Apr 26, 2011 01:45 IST
Manish Pachouly

Despite pressure from the Supreme Court, the Enforcement Directorate (ED) is struggling to bring on record evidence to prove that the overseas transactions of Pune businessman Hasan Ali Khan were a threat to national security.

Khan is in custody in a money laundering case. “We hit a dead end because the Intelligence Bureau (IB) failed to make a major breakthrough on Khan’s alleged connection with Saudi arms dealer Adnan Khashoggi,” said a senior ED official on condition of anonymity as he is not authorised to speak to the media. The ED had sought IB’s help to investigate Khan’s and Khashoggi’s business links.

The ED had during initial investigations found that $300 million (Rs 1,350 crore) was transferred from Khashoggi’s Chase Manhattan Bank account in New York to Khan’s UBS Zurich account.

From a document notarised by Nicholas Ronald Rathbone Smith, Notary, Public of London, seized from Khan, the ED learnt that in 1993-1994 UBS chief manager Dr Peter Weilly asked Khan to finance a Khashoggi project worth $300 million. Weilly was handling Khan’s portfolio too, said the officer.

The document stated that in 1997 Khan’s UBS account had a balance of $560 million (Rs 2,520 crore) that included $300 million transferred from Khashoggi’s account. The document said the amount was transferred to Khan’s account on the condition that he finance Khashoggi with another $500 million (Rs 2,250 crore).

The document said that after receiving the $300 million without interest or profit, and realising that Khashoggi was involved in investments that did not interest him, Khan decided not to finance the arms dealer further. However, in 2001, Khan’s UBS account was frozen with the observation “funds from weapons sales”. The ED is also wary because the Mumbai and Patna police have not made a breakthrough in Khan’s fake passport cases. “The police are yet to file charge sheets, making our investigation difficult,” the official said.

For making a case under the Prevention of Money Laundering Act (PMLA), a scheduled offence must be involved. Forgery and cheating are cheduled offences. However, PED officials said that with the police failing to establish an offence, it would be difficult to prove a case under PMLA.

Hasan Ali may be taken to Patna

A two-member team of the Patna police is in Mumbai to take Pune businessman Hasan Ali Khan to the Bihar capital in connection with a passport forgery case. Patna’s chief judicial magistrate had on April 19 allowed the Patna police to issue a warrant against Khan, who is in judicial custody. The magistrate had asked the police to produce him in court by April 30.

Patna’s regional passport officer had last November lodged a first information report against Khan for submitting fake residential proof to get a passport in 1997. Khan had mentioned his permanent address and place of birth as Sitamarhi, Bihar.

Khan had used the passport subsequently issued to travel to Singapore with his associate Kashinath Tapuriah and Bihar Congress leader Amlendu Pandey to open an account in SBC bank.

The Enforcement Directorate (ED) found that Pandey helped expedite Khan’s application in the Patna Regional Passport Office. The ED recently questioned Pandey, who revealed he had taken the help of Puducherry Lieutenant-Governor Iqbal Singh, who was a Rajya Sabha member between 1992 and 1998.

The ED would question Singh on Tuesday. Khan is likely to be taken to Patna on Tuesday.