Click to play videoMumbai: Hasan Ali Khan loves horses and that is his known occupation. But it seems he also likes to ride the stock markets as he has managed to run up unaccounted deals worth Rs 35,000 crore.
Sources at the Enforcement Directorate (ED) probing Hasan Ali have told CNN-IBN that Ali could be the invisible investor in Indian equity markets.
Common people need a PAN number and need to fill in a Know Your Customer form to invest even a small amount such as Rs 50,000 in the stock market. However, Ali is not an ordinary investor.
The tangled web of FDI, Participatory Notes (P-notes) and offshore tax havens have all come together in this free flow of funds and big fish could be caught in the web.
Here is how it works:
- People with huge amount of black money in India send the money abroad to tax havens like Maurtius, Seyshells and Cyprus.
- From here the money is routed right back to India through instruments like P-Notes.
- Simply put this is an instrument used by overseas investors to put money in Indian markets without the bother of registering themselves with market regulator SEBI.
The money is laundered and then finds its way back into lucrative and underdeveloped markets where it's a case of high risk, high returns. One of these developing equity markets is India.
These P-Notes can be traded like stocks and sold to others as notes. It is this transaction that is untracable. Enforcement agencies feel this money may even find its way to terror outfits.
And this fits in well with National Security Advisor M K Narayanan's earlier warning that terror outfits could be using the stock markets.
ED sources have told CNN-IBN that Hasan is probably the key man who is investing black money on behalf of top politicos, businessmen and bureaucrats.
The ED believes that in order to crack the exact source of these funds it needs to delve deep into the P-Note mechanism, but the Finance Ministry is not keen to pursue the matter, keeping in mind the fact that the markets are already treading on slippery ground.
| HAUL OF FAME | |
 Officials of the Income Tax Department and Enforcement Directorate are preparing to get the Swiss bank lockers of Pune horse owner Hasan Ali opened. | |
| Allegations are flying thick and fast that Hasan is acting as a front man for a host of politicians, industrialists and film financiers and laundering money. | |
| Sources in the I-T and ED departments say Ali's financial transactions could be spread over in a couple of countries and the turnover of the transactions could be anywhere between Rs 20,000 and Rs 35,000 crore. | |
| Sources said officials were preparing to go to Switzerland as they were confident of getting the bank lockers opened because they have "sufficient proof" of the "dubious sources" of Ali's bank accounts there. | |
| Ali's lawyer Viraj Kakade also denied allegations against the Pune businessman and said he had no no Swiss bank account and his business rivals could be behind them. |
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