February 07, 2011   5:57:38 AM

http://www.dailypioneer.com/316066/Terror-groups-hire-savings-accounts-to-launder-money.html

Starting a new trend in hawala transactions, terrorist groups are using savings bank accounts of individuals for laundering money used for subversive activities. This has come to the notice of intelligence agencies through the suspicious transaction reports (STRs) of the Financial Intelligence Unit-India (FIU-IND).

An intelligence report has stated that terror modules deposit cash in these accounts and their operatives withdraw it through ATMs at faraway locations. The terror groups pay cash ‘incentives’ to such account holders, the report added.

According to FIU-IND, a report indicating such suspicious transaction has been received from a savings account each in Kerala and Uttar Pradesh. In the case of Kerala, reports showed that deposits below Rs 50,000 were made into the particular account from various branches in the State and Maharashtra. The money was immediately withdrawn through ATMs in Hyderabad. Inquiries revealed that the account holder had gone to one of the Gulf countries for employment and had started his own business in flowers and curtains in Kerala following his return.

“Analysis of two bank accounts belonging to the person and his son revealed remittances from Gulf and immediate cash withdrawals from an ATM in Hyderabad. Investigations showed business connections with an accused, who was in police custody for involvement in a pipe bomb case. The money was withdrawn from a Hyderabad-based ATM by an associate of the accused and was allegedly used to facilitate terrorist activities,” the FIU-IND report said.

Likewise, a suspicious transaction report was received from the bank of a person residing in western Uttar Pradesh. This person, while opening the account, had declared his profile as self-employed (trader) with gross annual income of Rs 3 lakh. But the account details registered small cash deposits from various locations — including Jammu, Srinagar and Maharajganj, among other places — and the proceeds were withdrawn immediately from ATMs located in Uttar Pradesh and Delhi.

This was considered suspicious by the bank, which immediately reported the matter to authorities.

Inquiries by intelligence agencies revealed that the account holder owned a factory at Jammu and had business dealings in Srinagar. It was also revealed that one his relatives residing in Uttar Pradesh had links with terrorists and had even undergone imprisonment in Guwahati jail.

The number of STRs disseminated by the FIU-IND to intelligence agencies has increased over the years from a meagre 49 in 2007-08 to 90 in 2008-09 and 362 in 2009-10. Likewise, requests for information on STRs by intelligence agencies from the FIU-IND have also increased from 87 in 2007-08 to 190 in 2008-09 and 226 in 2009-10.

An official of the FIU said that transactions in the range of Rs 2 lakh to Rs 10 lakh had been noticed in the suspicious transactions and a portion of the amount is paid to the savings bank account holder as rent. “The transaction amount is apparently kept low to evade detection by security agencies. This also serves the purpose of the terror groups that work in modular fashion for carrying out subversive activities,” an official of the FIU said.

The FIU-IND assists intelligence agencies in combating financing of terrorism by dissemination of STRs and by providing information specifically requested by the intelligence agencies. The FIU-IND also shares information to foreign financial intelligence units on suspected money laundering and terrorist financing cases.