Black money chase: How Modi is cracking the whip on India’s shell firms

When Prime Minister Narendra Modi banned banknotes with a high face value in a surprise move at the end of last year, authorities found an outpouring of hiding companies depositing money in banks, apparently in order to hide that he owned this wealth .

At the time, said a senior Modi was lightning to the government, who did not understand how ghost companies were used to conceal assets and money laundering. The Modi Office has formed a team of law enforcement officials and administration officials to follow these companies, according to the report of the aid and government revised by Reuters.

Last month, authorities ordered the closure of nearly 200,000 shell companies, and using such government to survey hundreds of thousands of people. The systematic severity of ghost businesses – which do not have business operations or assets – is perhaps one of the most tangible results of demonetization, with the goal of hitting evasion and the Indian movement for digital cashless transactions that left a Paper trail

“We are at war against black money. The impact of this (punishment) will be huge on the shells of companies,” said the aid, which can not be named in accordance with government regulations. Reuters In his Independence speech Tuesday Modi has claimed credit for going after these companies, and warned that “looters of the nation’s wealth will have to respond.”

Modi took office in 2014 promising to fight corruption and carry a billion dollars hidden abroad, as well as in real estate, stock markets and borders through a network of fictitious names. While the move to eliminate 85 percent of the economy’s Shook bills and has been widely criticized, the uncontested wealth struggle provides overwhelming support for the Indians on foot who often pay a bribe for government services.

A high-level working group conducting the research found that hundreds of top-tier companies are registered in some buildings in Calcutta, according to a government note reviewed by Reuters. More than 400 companies have listed their domicile in a building in the colonial era until 9/12 Lalbazar street dimly lit.

In their many offices, companies offer services such as earthmoving equipment, infrastructure financing, information technology consultants and many others who owned office-sized rooms. Many were closed, their padlocks covered with dust. Others were bulky residential areas with clothes hanging from windows. Data provided separately by Tofler, a corporate database information service, has identified nearly 3,000 businesses in two building offices. Some were named after the flowers.

A Treasury inspector said the Calcutta companies were a virtual money-laundering industry and established parallels with the Panama law firm Mossack Fonseca, which emerged from the darkness of last year after the flight of millions of documents from his office Illustrate how the rich use offshore companies to avoid taxes.

“Kolkata companies are a huge network that takes their money from one end to the other and pulled out the other,” said the inspector, who declined to be identified because he did not Is authorized to speak to the media. Seafood companies hold much of the fraud and embezzlement of funds in India, according to tax authorities.

The owners of these companies to create elaborate smokescreens, including the appointed appointment staff and drivers as directors, said the Treasury inspector, adding that they are used to conceal the final beneficiaries, conceal money funnel investment policy to evade Taxes, committing fraud or manipulating offers.

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