Laundering probe: ED seeks transaction details from Hong Kong

The Enforcement Directorate (ED) has sought from Hong Kong authorities transaction details of bank accounts of two firms allegedly used by an Australian drug syndicate in order to identify its suppliers.

The Hong Kong-based firms part of the ED’s money laundering probe are allegedly owned by three Indian hawala operators-cum-associates of the Australian “Barbaro” syndicate that is linked with an Italian drug cartel, said a senior government source familiar with probe.

“The Hong Kong-based firms’ bank accounts were being used by the Australian Barbaro drug syndicate to launder its dirty money and pay up its suppliers, via cash withdrawals and layered banking transactions. We do not yet know who these suppliers are,” said the source.

An ED judicial request has been filed with Hong Kong authorities in this regard. The agency has already arrested the three alleged Indian associates of the Australian syndicate under provisions of the Prevention of Money Laundering Act (PMLA) and is preparing for a supplementary charge sheet in the case. The ED began its probe against the three Indians, who have denied the allegations against them, on receiving an alert from Australian enforcement authorities over a year ago.

“The three Indian hawala operators conducted transactions of up to `500 crore as per our estimates and we suspect that it was done at the behest of the Australian drug syndicate,” said another source. “The three accused are suspected to have pocketed 10% of it, around `50 crore, as their commission.”

According to the ED, the instructions for making the payments allegedly came via text messages to the three accused.

“The Hong Kong authorities can help us find out who exactly received the payments meant for the suppliers from the accounts located there,” said a source.

Once the enforcement agency has information on the suppliers, it would share the same with India’s Narcotics Control Bureau for further action. The ED, in particular, wants to verify if the Australian drug syndicate’s supply chain had Indian elements, according to the source.

The Barbaro gang typically would receive drug consignments from its suppliers and then initiate payments via its three Indian contacts, who used the Hong Kong-based bank accounts controlled by them to complete the transaction.