Income Tax Department Uncovers Massive Cryptocurrency Money Laundering Racket
In a significant crackdown on financial crime, the Income Tax Department has exposed a sophisticated money laundering operation that converted illicit funds into cryptocurrency across multiple cities. The department conducted coordinated search operations at 20 locations spanning Kolkata, Siliguri, Nashik, and Gurugram, targeting a network involved in laundering hundreds of crores through virtual digital assets.
Shell Companies and Bogus Expenses
According to official sources, investigators acted on specific intelligence regarding several shell companies that were systematically booking bogus expenses to conceal illegal activities. The search operations, which concluded three days ago, have revealed a complex web of financial deception. The initial trail led investigators to discover substantial unaccounted cash receipts and questionable loans, which were subsequently funneled into large undisclosed investments in real estate projects.
Surprising Discovery of NGO Payments
One of the most startling findings was the extensive use of payments to non-governmental organizations (NGOs) as a cover for money laundering. Officials uncovered instances where companies showed bogus payments toward students' fees and tax deducted at source (TDS), but the scale of payments directed to NGOs raised particular suspicion. Investigators believe these transactions were disguised as fake corporate social responsibility (CSR) payments, with the NGOs allegedly returning the funds in cash through clandestine channels.
Hawala Network and Cryptocurrency Conversion
The investigation has revealed that the illicit funds were laundered through an intricate network of hawala operators, who converted unaccounted cash into cryptocurrency using multiple layers of companies and individuals. This method allowed the perpetrators to obscure the origin and destination of the funds, routing them to undisclosed locations while avoiding detection by financial authorities.
Evidence Seized and Ongoing Investigation
Search teams have seized substantial incriminating evidence, both physical and digital, from the targeted locations. The recoveries include unaccounted cash, jewellery, and bullion, with several bank lockers placed under prohibitory orders to prevent further movement of assets. While the initial search operations have concluded, the Income Tax Department confirms that investigations are continuing as they unravel the full extent of this sophisticated financial racket.
The scale of this operation underscores the growing challenge authorities face in monitoring and regulating cryptocurrency transactions, particularly when combined with traditional hawala networks and corporate structures designed to conceal illegal activities.
