List of Scams in India 1957 - 2011

In the month of October we brought to our readers a series of Scams, frauds and scandals that had been committed in India after freedom in 1947. These scams were ranged from small to large scams that were unearthed in India and the culprits were charged sheeted and brought to the court of justice for committing frauds, economic offenses, Scandals and Scams within the Geographical territory of the Republic of India. The complete month of October was dedicated towards bringing awareness with our readers.

However, those who missed to read all these blogs due to a glitch in our servers, we had to repost all the blogs we had published before the servers were hit by hackers and it was brought down temporarily. this hacking led us to move to blogger from our existing servers and also resulted in loss of some posts that were prime evidences of exposing frauds.

We hereby bring a compilation to refresh you again with a Year wise Comprehensive list of a few Scams that were detected and unearthed in India.


  2011

•     ISRO Spectrum Allocation Scam - Although the congress led government was fighting rows over the 2G spectrum scam that another spectrum scam unearthed to give the government more headache. ISRO - A department directly under the Prime Minister had allegedly allocated the spectrum illegally to benefit another firm.
•     Hasan Ali Khan scandal - Hasan Ali not only had allegations of various frauds he is probably the richest fraud and scamsters of India.
  
•     Indian Black Money in Swiss Banks -
•     BL Kashyap EPFO Scam - One of the fastest growing Construction and reality company was then cought in a scandal where it invaded the EPF scheme policies. It fraud is estimated to be nearly Rs.169 Crores.

  2010

•     2G spectrum scam and Radia Tapes Controversy - The Radia tapes controversy relates to the telephonic conversations between Nira Radia, a political lobbyist and an acquaintance of the (then) Indian telecom minister A. Raja, and with senior journalists, politicians, and corporate houses, taped by the Indian Income Tax Department in 2008-09. The tapes led to accusations of misconduct by many of these people. Nira Radia used to run a public relations firm named Vaishnavi Communications, whose clients include the Tata Teleservices and Mukesh Ambani’s Reliance Industries.
  
•     Adarsh Housing Society scam - A scam that brewed in he heart of Mumbai started as a investigation for alleged illegal construction later revealed that Adarsh Housing Society, a cooperative society in the city of Mumbai in India, was reserved for the war widows and veterans of the Kargil War was found the the flats were allotted to bureaucrats, ministers and not a single flat was issued to the war veterans, the original beneficiaries of the scheme.
  
•     Commonwealth Games Scam - What was once thought to be the shining jewel in the crown of Indian sports was then let down to be the biggest scams in India.
•     2010 housing loan scam in India - The 2010 fake housing loan in India was uncovered by the Central Bureau of Investigation (CBI) in India. CBI arrested eight top-ranking officials of public sector banks and financial institutions, including the LIC Housing Finance CEO Ramchandran Nair, in connection with the scam.
  
•     Belekeri port scam - Another illegal mining and transporting of iron ore scam that was indirectly involved and alleged for accidents on road by heavy overloaded dumpers carrying iron ore to the ports of Belikeri.
  
•     Lavasa Scandal - The township that is flouted to be the first ever planned hill city in India landed into trouble over environmental clearance row.
  
•     Uttar Pradesh Food Grain Scam - The first FIRs in the case were filed in January 2005, when the state government acknowledged the scam to be worth Rs. 45,000 crore under the Central government sponsored Antyodaya Anna Yojana (AAY). Apart 65 officials named in the FIR, further over 300 persons were suggested to involved in the preliminary reports. Apart from that a district magistrate, six ADMs and a few district food and supplies officials were suspended
•     Andhra Pradesh Industrial Infrastructure Corporation Controversy - Andhra Pradesh Industrial Infrastructure Corporation Ltd also known as APIIC is part of the Andhra Pradesh Government initiatives with the objective of providing industrial infrastructure through development of industrial areas. The scam involved he anomalies in the land and development projects with EMAAR MGF.
  
•     Indian Premier League Cricket Scandals - Multi million dollar scams alleged to be associated with the most successful cricketing tournament in the world. The IPL changed all the rules of cricket by giving the world the most liked format of cricket the 20-20.
  

  2009

•     Madhu Koda mining scam - Koda is presently in jail after multiple bail pleas have been rejected. However, only a tiny fraction of the Rs 4000 crores (USD 800 million) graft money allegedly amassed by him has been recovered.
  

  2008

•     Cash For Votes Scandal - The cash-for-votes scandal is a scandal in which the United Progressive Alliance, the majority-holding parliamentary-party alliance of India led by Sonia Gandhi, allegedly bribed Indian MPs in order to survive a confidence vote on 22 July 2008.
  
•     The Satyam Scam - The Satyam Computer Services scandal was publicly announced on 7 January 2009, when Chairman Ramalinga Raju confessed that Satyam's accounts had been falsified.
  

  2006

•     Kerala Ice Cream Parlour Sex Scandal - The Kerala ice cream parlor sex scandal is one of the long running sex scandals in Kerala state, South India where many top political icons are allegedly considered to be involved in this scandal.
•     Scorpene Deal Scam - The successor of the Naval War Room Leak Scam  in which 500 crores (about USD 100mn) were paid as bribes to parties in India for the purchase of Scorpene Submarines for the Indian Navy.
•     Navy War Room spy scandal (related to Scorpene Deal Scam) - The scandal reportedly involved documents to be leaked on a USB pen drive from the Directorate of Naval operations in New Delhi and supposedly sent to arms dealers in Europe.

  2005

•     IPO scam - The stock markets have been jolted with many stock market scams in the past. This post is a collection of all scams and help you to understand the nature and magnitude of such stock market frauds and IPO scams.
•     Oil-for-food programme scam (Natwar Singh) - The alleged international scam that involved Natwar Singh in the Iraqi Oil for Food Scam.

  2004

•     Gegong Apang PDS Scam - The scam allegedly involved fraudulent hill transport subsidy bills that were passed while Apang was the Chief Minister of Arunachal Pradesh and the scam took place during his tenure. Gegong Apang was arrested in August 2010 for alleged corruption relating to a Rs. 1000 crore public distribution system scam.

  2003

•     Taj Corridor Scandal - The Mayawati led government in Uttar Pradesh started construction of a corridor near the heritage building of the majestic Taj mahal, later the project was stalled after the issue of environmental clearance came into light. The allegations also put case of money allotted for the project to get siphoned off into the bank accounts of Mayawati and her relatives.
  
•     HUDCO scam - HUDCO sanctioned Rs 14,500 crore as loans to different infrastructure corporations during the NDA regime. It was found in investigation that bribes were paid to get the Loans sanctioned.

  2002

•     Kargil Coffin Scam - In one of the most shameless scams in India, Kargil Coffin Purchase scandal revolved around irregularities in purchase of coffins for Indian Army after the Kargil war with Pakistan.
  

  2001

•     Ketan Parekh securities scam - Ketan Parekh could be termed as another Harshad Mehta where he siphoned off crores of Rupees from banks to target small stock exchanges to commit frauds in Stocks and Securities.
•     Barak Missile Scandal - The Barak Missile Scandal is a case of alleged defense corruption relating to the purchase of Barak Missile Systems by India from Israel. The case is currently under investigation by the Central Bureau of Investigation, and several people including the Samata Party ex-treasurer R.K. Jain have been arrested. Others named in the First Information Report include politicians George Fernandes and Jaya Jaitley, and arms dealer and ex-naval officer Suresh Nanda, who is the son of retired chief of naval staff S.M. Nanda.

  1997

•     Cobbler scam - In what was meant to benefit the poor cobblers as a scheme mooted by the government of India. The scheme came as a boomeranged and hit the cobblers in Mumbai, when they were sent recovery notice for grants they were never given. 
•     Sukh Ram telecom scam - Former telecom minister Sukhram in PV Narasimha Rao's cabinet has been convicted for awarding a lucrative contract to a private telecom firm for supplying cables to the government at inflated rates after receiving a bribe of Rs 3 lakh 15 years back.
•     Hawala Scandal - The biggest ever scandal in the world which involved over 115 top politicians and bureaucrats of the country. Never before so many top politicians been caught in a single scandal. Hawala Scam was bigger than even Watergate, Iran-gate, Bofors, Harshad Mehta, Tehelka and Lockheed scams.
  

  1996

•     Bihar fodder scam - The Fodder Scam (Devanagari: चारा घोटाला, chārā ghoṭālā) was a corruption scandal that involved the embezzlement of about Rs. 950 crore (US$192.66 million) from the government treasury of the eastern Indian state of Bihar. Among those implicated in the theft and arrested were then Chief Minister of Bihar, Laloo Prasad Yadav, as well as former Chief Minister, Jagannath Mishra. The scandal led to the end of Laloo's reign as Chief Minister, accused for the fraud of Bihar Fodder Scam.

  1995

•     Purulia arms drop case -The Purulia arms drop case was an infamous incident in which took place on 17 December 1995. The scandal revolved around an unauthorized arms drop from an Antonov An-26 aircraft in Purulia district in the state of West Bengal in India.
•     SNC Lavalin scandal - The SNC Lavalin scandal is financial scam related to the contracting of the government with a Canadian company, SNC-Lavalin for the renovations of the hydro electric power stations by the Kerela State Electricity board which resulted in the alleged exchequer loss of Rs. 375 crores.
  
•     Telgi scam - The one of the most nefariously crafted Stamp Paper Scam popularly known as Telgi Scam penetrated 12 states and is estimated at a whopping Rs 20,000 crore plus.

  1992

•     Harshad Mehta securities scam - Was the prime accused who engineered the rise of the BSE in 1992 by exploiting several loopholes in the country's banking system. He along with is associates siphoned large amounts of money and bought shares to create a false boom in the Bombay Stock Exchange in 1992.
  
•     Palmolein Oil Import Scam, Kerala - The case revolved around the scam in import of palmolein oil from Malaysia by the government of Kerala, India.
  

  1989

•     Bofors Scandal - The scam related to the purchase of Artillery Guns Bofors purchase during the regime of Late Rajiv Gandhi. The ghost of this scam still haunts the Congress Party and had also been a cause of defeat in many elections.
  

  1982

•     Cement Scam involving A R Antulay - This case reminds me of our school days when we used to promise stuff to friends in lieu of something else. Similarly, Mr. A R Antulay took favours in lieu of promising Cement to Builders.
  

  1971

•     Nagarwala Scandal - A scandal one of its kind, where Nagrawala mimicked the voice of the then Prime Minister of India to cash out 60 Lakhs from State Bank of India.

  1957

•    Haridas Mundhra scandal - The first ever documented scam was recorded in 1957, the scam exposed the nexus of government and Finance Departments. The scam led to the resignation of Finance Minister T. T. Krishnamachari.

All you need to know about CAG

How Hawala Works ?

"Hawalas" is an ancient, unregulated, and little-known systems of exchanging money. A hawala (derived from the Arabic word for "a bill of exchange or promissory note") is a system of brokers that provides paperless banking transactions and enables individuals to transfer large sums of cash from one country to another without the funds ever crossing borders or being recorded. The hawala system predates conventional banking by thousands of years and is prevalent in India, Pakistan, the Middle East, and parts of Asia.

Here we explain to make you understand How a hawala system might work: In Afghanistan, or any other South Asian nation, a man finds a hawala dar (a broker who has inherited the job from his family through several generations) and gives him a certain amount of money to be transferred to a relative, friend, or cohort in America. The broker then contacts by phone, fax, or e-mail a fellow dar who is set up — usually in association with a legitimate business — in an American city. He then asks that broker to pass on an equivalent sum of money to the intended recipient. Thousands of dollars can be moved in a matter of minutes, with no questions asked and no record of any kind. The two brokers even their balance over time, usually through a reverse transaction (when someone in the United States wants to send money to a counterpart in the same city in Afghanistan, for example). However, because the system is based on a long-standing trust among hawala dars, there is no need to balance accounts at the end of each day, or even at the end of each month, as with conventional banking. This makes transactions even more difficult to track.

While much of the money that flows through the hawala system in the United States is used for legitimate purposes — a son sending money home to his parents, for example — hawalas also allow terrorists and drug dealers to smuggle money into the country, undetected by the global banking system. The State Department has long been aware of the challenges posed by hawalas and reported them in its annual International Narcotics Control Strategy Report.

Congress, too, has recognized the danger of hawalas and moved to regulate their activities in 1994, when it passed a law requiring check-cashing businesses and informal financial enterprises like hawalas to register with the government and report transactions greater than $3,000. Unfortunately, the regulations implementing this statute remain unpublished, while hawalas continue to operate in the United States without supervision. Now Congress is moving toward further regulation and oversight of hawalas, including passage of my legislation requiring hawalas to register with the U.S. government.

The recently proposed bills on record-keeping and account-monitoring, for example, would expedite the publication and enforcement of hawala regulations and give U.S. law enforcement and intelligence authorities the tools they need to intercept terrorist financing before it is too late. Targeting the financial network of terror groups like al-Qaida will not, by itself, strike a deathblow to international terrorism. But it will disrupt the criminal financial network supporting terrorism, and it will give U.S. law enforcement and intelligence communities a better chance of detecting and preventing terrorist activities.

Rajiv Pandit reads India Fraud Exposed

Rajiv Pandit the prime accused of Torno Herbal Coil scam had recently read articles about his wrong doings. We have also received an email from him using the email id rajpro2000@gmail.com surprising to see a Country Head and a learned man using a private email address to convey his message.

Below we share a snap-shot of the received email from Dr. Rajiv Pandit, threatening our team of dire consequences if we bring out his misdeeds to the masses. 

We believe that this email is work of a spoof and our team is researching the authenticity of the email said to be received from Dr. Rajiv Pandit himself. We will post more on the development on the Rajiv Pandit Mega Care Fraud after we receive a satisfactory reply from Dr. Pandit and Megha Pandit Wasnik to prove they are not guilty.

We see this email as a positive node towards spreading of awareness of fraud companies now if Dr. Rajiv Bhaskar Pandit and his wife Dr. Megha Wasnik Pandit are genuine they will surely come up with proofs to their innocence and rest an affirmative case for their genuinity.

We request all our readers and the masses to also contact our team and email their grievances like the Torno Herbal Mosquito Coils Scam victims have done it, we always aim to get the voices of the victim to reach everyone and spread awareness. 

Recent development Purulia Arms Dropping Case

On 8 October 2008 the extradition of the key accused, Kim Davy, real name Niels Holck, was close to being finalized as the government had, in principle, agreed on giving "sovereign assurance" to the Danish authorities on their conditions, as well as bringing about some changes in the existing extradition law. One of the conditions Denmark had set included the waiving of the death penalty if Davy is convicted by a court for his involvement in the dropping of a huge cache of arms and ammunition from an aircraft in West Bengal in 1995.

On 28 April 2011 Kim Davy came forward and alleged that both the Indian government (congress party) as well as its intelligence agency R&AW were aware of the precise details of the arms drop well in advance, and that the whole operation was conducted with the implicit agreement of the Indian authorities. Both Peter Bleach and Kim Davy claimed that the aim of the arms drop was to help anti Left government dissidents and to create a pretext to impose President's Rule in West Bengal.

On 29 April 2011 Central Bureau of Investigation denied all allegations of involvement or collusion in the arms drop. Questions have been raised if Kim Davy's 'sensational revelation' was aimed to stall the extradition efforts of India. Some political analysts have also questioned the 'timing of the revelation' which may help the Left parties in the ongoing state government assembly elections.

On 30 June 2011 Central Bureau of Investigation has been denied to extradict Kim Davy a.k.a Neils Holck to India for further proceedings in India. The Danish High Court dismissed the plea on the grounds of "torture or other inhuman treatment".

How Gegong Apang looted Arunachal Pradesh: Investigation report

This dates back in October 2004 when Bamang Anthony, president of Arunachal Citizens' Rights (ACR) decided to file a PIL in the Gauhati High Court regarding certain anomalies that he had smelt in the public distribution system (PDS) in Arunachal Pradesh, little did he realise that he was actually digging one of the biggest food scams in the entire subcontinent.

Six years later, he is glad his efforts have paid dividends. Former chief minister Gegong Apang has been arrested in connection with that scam, which is now believed to be of the magnitude of about Rs 1,000 crore.
Arunachal Pradesh and five other hill states of the Northeast get two types of reimbursements from the government of India for transportation of food grains under the PDS. While the first is reimbursement of Road Transport Charges (RTC) for lifting of food grains from the nearest rail head of Food Corporation of India (FCI) depots to the base depots, the second is called Hill Transport Subsidy (HTS) for moving the stock from the base depots to the approved principal distribution centers.

Interestingly, even as Bamang Anthony and The Indian Express were only looking at suspected large-scale irregularities in the distribution of food grains in the state, the FCI itself found out, through a special audit, an "excess payment" of Rs 193.53 crore in just one year (2003-04).

The HTS alone for three particular years in which misappropriation was suspected was as follows: Rs 24.27 crore in 2001-02, Rs 75.03 crore in 2002-03, and Rs 279.64 crore in 2003-04.

But what was more interesting is that while on one hand the quantity of food grains "supplied" to the people of Arunachal Pradesh under PDS increased (from 54,765 MT in 2001-02 to 85,272 MT) and the reimbursement of HTS also increased, several instances also came to light where the supply records were grossly fraud and fictitious.

One such instance, which The Indian Express highlighted as an illustration of the scam, was the supply of salt under PDS in Damin, a revenue circle in Kurung Kumey district. While the circle had a population of 2,784 (according to 2001 census), records showed that every individual consumed at least 24 kg of iodised salt per month in 2004. Another instance: In Koloriang circle in the same district, roughly 4,800 persons were shown as having consumed 3,080 quintals of rice every month in 2004, which comes to 64 kg per person per month.
It is, however, not Gegong Apang alone who is suspected to be responsible for the multi-crore scam. Transporters, suppliers, government officials, political leaders including MLAs - a large number of people actually benefited from it.

In July 2004 for instance, 5,000 quintals of rice kept in some private godowns in Nagaon (in Assam) for onward dispatch to Arunachal Pradesh disappeared. Submission of false bills for carrying foodgrains by smaller vehicles (where trucks can't ply) and by headloads (to villages which have no road links) was another means of siphoning off huge sums. In some instances, registration numbers of mini-trucks shown in bills were later found out to be of scooters and motorbikes.

What was most interesting is the story of a government officer, N N Osik, then director of civil supplies, who opened a separate account in the SBI at Itanagar just to receive "commissions" from the contractors engaged for transportation.

Between October 4, 2002 and July 16, 2003, Osik's balance in this account rose to Rs 2.85 crore. On one single day, February 14, 2003, numerous people deposited a total sum of Rs 97 lakh. What Osik immediately did was change his name, by an affidavit, to N Lego.

His name figures along with Apang's in a list of 40 accused persons, which the Special Investigation Cell probing the scam submitted to the the Gauhati High Court in October 2008.

Source: Indian Express

Gegong Apang PDS Scam Arunachal Pradesh

The former Arunachal Pradesh chief minister Gegong Apang, prime accused in the Rs 1,000-crore public distribution system (PDS) scandal that came to light in 2004, he was arrested and sent for remand in the police custody today.

Gegong Apang, aged 61, was arrested in Itanagar by the Special Investigation Cell (SIC) constituted by the Gauhati High Court, and charged under IPC Sections 120B (criminal conspiracy), 420 (cheating), 468 (forgery) and 409 (criminal breach of trust), read with sections of the Prevention of Corruption Act, 1988.

"We have registered eight cases in connection with the scam. So far 50 persons have been chargesheeted, of which 30 have been arrested. Today we arrested former chief minister Gegong Apang on the basis of material evidences and oral depositions made by a number of witnesses including several of the co-accused," M S Chauhan, SP, SIC, told The Indian Express over the phone from Itanagar.

Chauhan said Apang was the kingpin of the scam. "You cannot expect clerks and transportation contractors to misappropriate a huge sum like Rs 1,000 crore without the involvement of big and influential people," he said.

The cases pertain to huge anomalies including forgery and fraud that took place in the PDS in Arunachal between 1995 and 2004.The case was brought to national attention by a four-part investigation published in The Indian Express in May 2005.

The forgery and fraud took place at two levels: (i) payment of huge sums as reimbursement of Hill Transport Subsidy and Road Transport Charges from the Government of India for transporting PDS items to the state, and (ii) showing delivery of PDS items without actually reaching them to the people.

Read more on How Gegong Apang Looted Arunachal Pradesh

Source: Indian Express

Scorpene Deal Scam

The Scorpene Submarine Deal Scam is one of India's largest bribery corruption scandals, in which Rs. 500 crore (about USD 10 mn) were allegedly paid to government decision makers by Thales, the makers of the Scorpene submarine. The amount was channeled via middlemen such as Abhishek Verma. Also involved was Ravi Shankaran, a relative of the then chief of navy staff Arun Prakash. He is the prime accused in the Navy War Room spy scandal.

In October 2005, defence minister Pranab Mukherjee approved the Rs 19,000 crore submarine deal with French company Thales. Scorpene submarines are now being built in India under a technology transfer agreement that was part of that contract. The Scorpene Submarine Scandal was yet another scam involved in a multi billion dollar military hardware purchase.

HUDCO Scam, The CIC Report

The HUDCO Scam siphoned crores of rupees as loan. Investigations revealed that there was bribes paid to officials to get these loans meant for upliftment of the poor. The Right to Information Act helped to unveil the mystery behind the Central Vigilance Commission proposing and the CBI disposing in the Rs1,300-crore HUDCO scam. Showing signs of a nexus within the affluents within the government body.

The Central Information Commission directed the CBI to provide the inquiry report on closing investigation in fourcases where the CVC found "adequate evidence of paying bribes" to mobilise funds from Housing and Urban Development Corporation (HUDCO) in 2006. The Central Bureau of Investigation had closed the case saying there was not enough evidence to proceed with the probe. This resulted in the housing and urban development ministry submitting a closure report in Supreme Court in 2007. The corporation had invested Rs. 950 crore in West Bengal Infrastructure Development Finance, Rs. 200 crore in Himachal Pradesh Infrastructure Development Board and Rs. 150 crore in Vidharbha Irrigation Development Corporation.

There were allegations that money was paid to get these funds from HUDCO. “It appears that CVC found clear evidence showing bribes were taken. However, the CBI and the (Housing and Urban Development) ministry have come to the conclusion there is no wrong doing. If corruption is to be curtailed.... citizens need to get information of this nature," Information Commissioner Shailesh Gandhi said.

The CBI's information officer Pradeep Kumar had refused to provide information to RTI applicant AN Gupta on the ground that the probe report was confidential. The investigations were closed in 2007 and that SC was informed about it. Gandhi said the information officer had wrongly applied the exemption clauses and said "mere fears without any justification" could not be grounds for denying the citizen's fundamental right. The commission also said the Kumar had failed to justify the reasons for denying information as stipulated under the RTI Act.

Cobbler Scam - $600 million shoes scam India

India being a large country and blessed with varied natural and cultural diversity is also blessed with a lesser desired blessing, called Scams. A lot of scams are discovered in India every now and then, as if its a day to day routine and like the corruptions in India can never come to an end. If one corruption is exposed another one start somewhere. This also reminds me one of the biggest multi million dollars scam in Indian History which was nicknamed The Great Cobbler Scam.

What really happened in this Great Cobbler Scam was that various businessman & politicians had siphoned around $600 million US dollars from a scheme that was floated by the Government of India meant to benefit the poor cobblers of Mumbai. Instead, it went into the pockets of wealthy elite and bureaucrats who used this money to built luxury homes for themselves and also brought luxury cars, boats, arts...etc. Pretty common use of Tax Payers money.

The money of the scheme to benefit the poor cobblers in Mumbai, was meant to provide low interest loans and tax concessions to the Mumbai's poorest - cobblers who work 16-hours a day for less than $2. Not a single penny of the scheme from the government of India reached these poor cobblers of Mumbai, Maharashtra.

The modus operandi of the masterminds of the cobbler scam was to float a cooperative society of cobblers to avail the soft government loans through various schemes. Several bogus societies of cobblers were formed only for the purpose of availing these soft government loans for the poor cobblers.

The people involved in this racket were Saddrudin Daya, former sheriff of Mumbai and owner of Dawood Shoes, Rafique Tejani, owner of Metro Shoes, Kishore Signapurkar, proprietor of Milano Shoes, and Abu Asim Azmi, president of Samajwadi Party's Mumbai unit and partner in Citywalk Shoes. Beside them various officials of banks and financial institutions were also involved in this multi million dollars Cobbler Scam.

The Banks whose officials were involved in this scam are : Maharashtra State Finance Corporation, Citibank, Bank of Oman, Dena Bank, Development Credit Bank, Saraswat Co-operative Bank, and Bank of Bahrain and Kuwait. All were booked for economic fraud.

This scam costed the Government of India around $600 million US dollars. The cobbler scam was one of the worst scam in India that cheated the poorest people of the society and benefited a lot of rich and elite. Such Scams are one of the cause that proverty in India is difficult to eliminate.

Hawala Money Laundering Scam

The Hawala Money Laundering Scam hovered around the fact that the Hawala channels through which terrorist outfits in Kashmir like Hijbul-Mujahideen used to get funds, the same channels used to grease the palms of over 115 top bureaucrats and politicians of the country. CBI, RAW and every other investigative agencies of the country suppressed the entire Hawala case. 

Indian government accuses Pakistan for encouraging dreaded militant outfit Hijbul-Mujahideen to spread terrorism in India, but why does it not want to investigate the Jain Hawala case, which is directly connected with the funding of the Hijbul-Mujahideen ? It is the same organization which has been behind maximum terrorist attacks and has also caused the Kargil war that took the toll of hundreds of our young officers and soldiers.

The Video is a compilation of a Crusade of one Man Vineet Narain, who exposed the hawala case.

Click the link to know more about Hawala.

Barak Missile Purchase Scam Defense

The Barak missile system was jointly developed by Israel Aircraft Industries (IAI) and RAFAEL Armament Development Authority of Israel.

On 23 October 2000, contracts had been signed by the Indian government to procure seven Barak systems at a total cost $199.50 million and 200 missiles at a cost of $69.13 million. This was done despite objections raised by several groups, including members of the team that had originally visited Israel to observe the missile performance, and APJ Abdul Kalam, then heading the Defence Research Development Organization. Though some of the objections were of a procedural nature, the Navy Chief of Staff Sushil Kumar is currently under investigation as to why these objections were not considered.

In 2001 a sting operation conducted by Tehelka alleged that 15 defence deals made by the government had involved some sort of kickback and the Barak missile deal was one of them. Transcripts of conversations between the undercover Tehelka operative and R. K. Jain indicate that Jain accepted bribes from Suresh Nanda in the amount of one crore.

The NDA government set up a commission to investigate the matter. The UPA government, rejected the partial report by the commission and the Central Bureau of Investigation (CBI) began investigating the case.

The Central Bureau of Investigation lodged an First Information Report (FIR) on 9 October 2006 and claimed that George Fernandes the Indian defense minister at that time, and the Former Chief of the Indian Navy, Admiral Sushil Kumar were involved. The FIR notes that the Indian Defence Research & Development Organization had sought to block the import of the Barak system right until the end. The FIR restates R.K. Jain's admission to Tehelka that 3 per cent of this cost went to Fernandes and Jaya Jaitley as commission, while he himself was given 0.5 per cent. These commissions were paid to them by Suresh Nanda, the middleman in the deal, according to the Tehelka tapes.

Suresh Nanda, his son Sanjeev Nanda, and two others were arrested on the 9 March 2008 under section 120-B (criminal conspiracy) and section 201 (committing offense to cause disappearing of evidence) related to the scandal.

Sukh Ram telecom scam

He himself would have never thought that a bribe of Rs. 3 Lakhs could land him into trouble after 15 years. Special Judge RP Pandey, convicted 84-year-old Sukhram on charges of misusing his official position in awarding the contract and causing loss to the state exchequer, is likely to decide on quantum of sentence to him on Saturday.

The corruption case dates back to year 1996, when the telecom ministry was under Sukhram. Sukhram had awarded private firm Haryana Telecom Limited (HTL) a contract worth Rs 30 crore to supply 3.5 Lakh Conductor Kilometers (LCKM) of Polythene Insulated Jelly Filled (PIJF) cables to the telecom department.
Sukhram had been put on trial along with HTL chairman Devinder Singh Choudhary who died during the trial.
 
"Sukhram also obtained (illegal) gratification other than legal remunerations from Choudhary as a motive or reward for showing the favour to the said firm (HTL)," the judge said.

"It is not the prosecution case that Sukhram got only this much amount in this deal which runs into crores of rupees. The prosecution case is that the amount of Rs 3 lakh which was recovered from him was the bribe money.

"It is a matter of common knowledge that it is virtually impossible to get any direct evidence where both i.e bribe giver and the person who takes the bribe, worked in joint concert," ASJ Pandey said in his 188-page order.

Harshad Mehta Stock Market Scam

Harshad Shantilal Mehta was born in a modest Gujarati family. He was alleged to have engineered the rise of the BSE in 1992 by exploiting several loopholes in the country's banking system.

Harshad Mehta and his associates siphoned off funds from inter-bank transactions and bought shares in huge numbers at a premium across different segments, triggering a false rise in the Sensex.

When the scheme was exposed, banks started demanding their money back, causing the Bombay stock market to collapse. He was later charged with 72 criminal offenses and more than 600 civil action suits were filed against him.

In April 1992, press reports indicated that there was a shortfall in the govt securities held by the State Bank of India (SBI). In about a months time investigations uncovered the securities scam involving misappropriation of funds to the tune of Rs.3,500 crore.

The scam engulfed top executives of large nationalized banks, foreign banks, financial institutions, brokers, bureaucrats & politicians. In less than two months following the scam, the stock prices dropped by over 40%, wiping out market value to the tune of a whopping Rs.100,000 crore.

He took the price of ACC from 200 to 9000. That was an increase of 4400%!!!

The market went up like crazy and the bulls were on a mad run. Since he had to book profits in the end, the day he sold was the day when the market crashed. One lesser known fact about this scam is that there was a very important player in this scam who managed to keep a very low profile. That man was Nimesh Shah. He was just as involved as Harshad Mehta but he knew how keep out of the hands of the law. Nimesh Shah still deals in the stock market and is known to be a heavy player. Harshad Mehta is now dead. It is rumored that when he died, he still had 10% of ACC shares with him.

Reference : http://indiatoday.intoday.in/story/big-bull-harshad-mehta-pays-dues-9-years-after-death/1/132637.htm

Read more at: http://indiatoday.intoday.in/story/big-bull-harshad-mehta-pays-dues-9-years-after-death/1/132637.html

Madhu Koda Mining Scam

On 10 October 2009, he was charged with laundering money. The Income Tax Department uncovered over 4000 crore in illegal assets owned by Koda. Among others, these assets were reported to include hotels and three companies in Mumbai, property in Kolkata, a hotel in Thailand, and a coal mine in Liberia. This alleged scam is said to be the second-largest scam uncovered in India in 2009 and gets his name included in the list of controversial Indian businessman like Hasan Ali Khan and Harshad Mehta.

In the probes, it was found that Maoists received a 30% share of the "Koda plunder". This has led to staunch criticism of Koda from sections of society, including the opposition Bharatiya Janata Party. Gujarat Chief Minister Narendra Modi stated Koda was part of a corrupt network of Congress Party who stole money from Jharkhand.

In July 2011, the Member of Parliament, Mr. Madhu Koda was transferred to Delhi's high profile Tihar Jail from Chaibasa Central Jail after being given permission by the Jharkhand Vigilance Court so that he can attend the monsoon session of the Parliament.

SCAM Indian Premier Leagur Scandal

IPL supremo Lalit Modi (r) with Bollywood stars Shah Rukh Khan (l) and Preity Zinta (2nd from r).

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In April 2010, one of the biggest scandals of Indian sports hit the headlines courtesy Indian Premier League commissioner Lalit Modi and then Minister of State for External Affairs Shashi Tharoor.

What has spelled big business and massive viewership for parent cricketing body BCCI went for a toss when the two high-profile individuals leveled grave charges against each other on the social networking site Twitter.

Modi, who launched the in 2008, accused Tharoor of influencing a $330-million bid for an IPL team (Kochi) and managing “sweat equity” of $15million for his “girlfriend.”

In the political brouhaha that followed Modi’s tweets, Tharoor was forced to resign.

The issue grabbed headlines as the Congress-led coalition government at the center was furiously engaged in securing support over high food prices in Parliament. The government could not let the matter pass.

The government hit back, and federal tax authorities launched a massive probe into the $4 billion IPL sport franchise and Modi.

Isolated, Modi was stripped of his position as IPL chief.

Now the noose is tightening around Modi.

The news Web site Livemint.com reports:
 

Even as Lalit Modi, the suspended chairman and commissioner of the Indian Premier League, dismissed the second show-cause notice issued to him by the Board of Control for Cricket in India as “fiction” on the Times Now TV channel, the game’s administrator in the country is building up its case against him.
 

The second show-cause notice accuses Modi of trying to split the cricket world by starting a rebel league. 

The first show-cause notice is over allegations of wrongdoing in conducting IPL.
 

The e-mailed minutes of a meeting supposed to have been held by Modi March 31 in New Delhi shows that Modi may have discussed a plan to start a parallel 20-over cricket league in the U.K. that mirrors the IPL format. The e-mail was shown to Mint by a BCCI official, who didn’t want to be identified, after Modi dismissed the show-cause notice issued to him on the TV channel.
 

The e-mail, marked highly confidential, was purportedly sent by Stewart Regan, chief executive of Yorkshire County Cricket Club, and gives details of a meeting held by Modi and senior officials of various county cricket clubs in the U.K.

“BCCI has proof that Modi is in advanced stages of planning and discussion with the three county clubs to create a rebel league,” said the BCCI official.

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Cheerleaders at an IPL match epitomized the focus on glitz.

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IPL brought an amalgam of cricket, business and Bollywood, overseen by Modi, to levels never witnessed before in India.

The dizzy heights achieved by the league are unprecedented in the history of Indian cricket and could even overtake big earning sports leagues such as the NBA.

Cutting through red tape and opposition, Modi managed to convert the T20 format into a power-packed high voltage three-hour drama of cricket, business, glamour and late night parties. The big money being splashed about catapulted Modi into instant stardom.

Last year, the brash chairman even transferred the IPL event to South Africa when security concerns and general elections loomed large.

Most feel he got too big for his boots when he tried to take on Tharoor, a sitting minister. The ensuing scandal threatened to ensnare the beneficiaries of the cricket moolah -- top Bollywood stars (team owners, real or purported), senior politicians and high flying corporate czars were under the scanner of the taxmen, media and thus the public.

Modi’s business methods have the transparency of mud. He is being accused of favoring relatives, family and close friends.

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Shilpa Shetty, one of many actors who added a dash of Bollywood glamour to IPL.

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The allegations against Modi entail manipulation of team auctions, using family and friends as proxies for his holdings, accepting bribes for advertising deals and routing investments through tax havens like Mauritius and British Virgin Islands without keeping the information above board.

Then there is the suspicion of Modi pocketing $80 million “facilitation fee” for awarding television rights of IPL, besides holding a substantial stake in the IPL team Rajasthan Royals.

Forbes India reports that Modi got into trouble with Home Minister P. Chidambaram last year:
Apparently, Modi had gone to the home minister’s office to seek clearances for the league matches. But in an appalling breach of protocol, he refused to wait for his turn to meet Chidambaram and instead attempted to barge into the minister’s office. Now, Chidambaram is the kind of man who doesn’t suffer either fools or arrogance and promptly asked Modi to leave. A miffed Modi said some daft things, stormed out of the room and eventually created an altogether avoidable controversy that snowballed into Season 2 being shifted to South Africa. . .
 

Much has been made and written of his brusque and arrogant nature. Both of which are on abundant display when he tried to bulldoze his way through Chidambaram’s office. Fact is, he is also a bully. And the defining trait of all bullies is that they cow down where glowered at. Why else do you think he’s been desperate to mend fences with Chidambaram?

Then of course, there is his legendary capability to execute relentlessly what he sets his mind to. How many men do you know of who can take one of the largest sporting shows on earth and move it to another country in three weeks flat? For that matter, how many men have you heard of who’s built a franchise that’s worth more than $4 billion in just about three years?
 

All of this said, a couple of questions remain. How in the devil’s name did Modi manage to pull off something as significant with an entrepreneurial zeal that can be only described as mercurial? More importantly, how did he manage to create the astronomical valuations that the IPL now commands? Answers to these questions reveal a tale of uncanny entrepreneurship and a remarkable ability to subvert the system he operates in.

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A Kolkata Knight Rider fan.

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Multiple issues are still under investigation even as Modi has handed a very bulky 15,000 page answer to 22 counts of charges of corruption leveled by the BCCI.

Some allegations have also been put forward from Britain that Modi attempted to fracture local cricket and nurtured ambitions to create an England-based cricket League.

The charges wiped out every bit of support Modi had.

Modi supporter Sharad Pawar (Congress party top dog and agriculture minister, president elect of the International Cricket Council and former head of the Indian Cricket Board) could not save Modi from being replaced by an Interim IPL head, Chirayu Amin.

Recently, a meeting was held by the BCCI and IPL interim chairman Amin to discuss last season’s IPL and its continuance.

The nexus between politicians and sports is well established in India and seen as one big reason for the abysmal state of affairs. The country barely manages to make a mark into the medal charts of Olympics or other world events.

With big money being churned at IPL, it was inevitable that the cricket pie would have all sorts of vested interests jostling for a share. There was a clear lack of interest by the authorities till the careless tweets came up.

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India is a country where the poor earn less than $2 a day and over 37 percent of the population subsists below the poverty line. The grant of tax concessions, security subsidies, low rentals of stadia and other freebies for the various IPL events just does not seem right.

Scandals such as these focus on the need of the government to fulfill its role as a proper regulator, watchdog or supervisor. There is need to reform, restructure and revamp the system and the way sports are handled, apart from infusing transparency.

The loopholes need to be plugged along with adoption of best practices and a clear cut policy on the issue of “sweat equity” (read undeclared assets and influence) that provides scope for power plays by politicians.

Sports bodies need to be managed the right way by professionals so they can sustain revenues that in turn should be utilized for furthering the cause of sports in India.

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IPL cricket league represents a dizzy mix of sport, business and entertainment so much so that Modi called it “cricketainment.”

Yet Indians who have worshipped cricket as a religion and cricket stars have reason to feel cheated.

So what’s next? Have Modi and IPL become inextricably linked?

According to Forbes India:

 
There are doubts about the IPL’s future if Modi is removed. Will his replacement, Chirayu Amin, be able to give the same amount of commitment? And more importantly with its numero uno decision maker gone, will the IPL retain its ability to think on its feet? “Modi is a one-man show,” says a person who works with him. “You would think someone who handles hundreds of crores worth of deals would have learned to delegate. But no, even for the MRF blimp that cost a measly Rs. 15 crore, Modi took the call,” he says. Amin is a BCCI member with no stake in any franchise. He runs his own company. Will he bring the same amount of energy into the IPL? And more importantly will he be able to balance franchisee interests along with BCCI interests?

The IPL may run along without Modi but don’t expect the same style and grandeur that he brought to the event. Yes, his wings need to be cut because too much power in one individual’s hands is bad for any organization. “Modi hasn’t put any systems in place. You get the feeling he is actually indispensable,” says a sponsor.

Source: Siliconeer 

Naval War Room Leak Scandal

In July 2005, Outlook magazine reported that some classified documents were leaked on a USB pen drive from the Directorate of Naval operations in New Delhi (also called the Navy war room). However, they were intercepted by air force intelligence from the house of wing commander S L Surve. The military documents, which dealt with Indian defense purchases, were supposed to be passed on to Thales and other international arms sellers via Shankaran.

After the leak was exposed, the Navy conducted its in-house investigation, and in December 2005, it sacked three commanders in the Indian navy, Vijendra Rana, Vinod Kumar Jha and Captain Kashyap Kumar, without any investigative or court trial. Officially, the reason given for their dismissal under the rarely-used "President's `Pleasure" clause, was because they had leaked classified information after accepting gratification, and this may affect the "security of the State", but the lack of criminal charges against the three has been very surprising. In fact, the Indian navy did not pass on the case to the nodal investigative agency, the Central Bureau of Investigations until nearly a year had passed after the initial break on the scandal, while others hinted that the investigation may have been deliberately delayed, possibly to protect Shankaran.

Ravi Shankaran and other accomplices named in the media expose were allowed to leave the country. After the media clamored about the Indian navy investigations on the War Room Leak Scandal, investigations were handed over to the CBI. Raids were conducted in 20 offices and residences nationwide, Shankaran's friend and business partner, retired Commander Kulbhushan Parashar was arrested in April 2006 at the Indira Gandhi Airport in New Delhi. The large number of documents uncovered by the CBI resulted in many more arrests such as arms dealer and billionaire Abhishek Verma and Wing Commander S.L. Surve. Also arrested was Rajrani Jaiswal from Pune, who was apparently used by Kulbushan Parashar as a "honey trap". Surve, who was posted as joint director (air defence) in the Air HQ, was so besotted with Rajrani that Surve's wife complained to the Indian Air Force (IAF) about them. Eventually Surve was fired, and both he and Verma are presently in jail.

However, Shankaran had left the country in November 2005 - well after the media publications, but during the Indian Navy's internal investigations. The CBI found that he had been staying with relatives in London. An Interpol Red corner notice was issued against him in 2006. His passport was revoked and his property was attached in September 2006. He was also spotted in London and an UK court issued an arrest warrant, but he evaded the police and apparently went to Sweden.

In Dec 2007, Arun Prakash responded to the media in a public statement quoting a CBI document:

The investigation so far, leading to the filing of two charge sheets has not revealed any incriminating act on the part of Admiral Arun Prakash with regard to this conspiracy.

It appears that Shankaran and Parashar, both of whom had taken early retirement from the navy, had convinced their friends commander Vijendra Rana, commander Vinod Kumar Jha, and the then director of naval operations Captain Kashyap Kumar to enable the copying of classified information from the Navy War room in the South Block. Eight pen drives were used to carry the information to their contacts in international armament companies interested in selling to India. Only two of the eight pen drives could be recovered.

Subsequently, the War room leak was linked to the Scorpene Submarine scam, in which 500 crores (about USD 100mn) were paid as bribes to parties in India.

In April 2010, four years after the Interpol Red corner notice had been issued against him, Ravi Shankaran was arrested in London. Reports indicate that he was being extradited via proceedings in the court of District Magistrate, Westminister's Court, London. However, in over a year, he is yet to be extradited as of June 2011. Meanwhile, he is on bail in London.

Uttar Pradesh Food Grain Scam

Uttar Pradesh food grain scam took place between years 2002 and 2010, in Uttar Pradesh state in India, wherein food grain worth INR35,000 crore (US$7.1 billion), meant to be distributed amongst the poor, through Public Distribution System (PDS) and other welfare schemes like Antyodaya Anna Yojana (AAY), Jawahar Rozgar Yojana and Mid-day Meal Scheme for Below Poverty Line (BPL) card holders, was diverted to the open market. Some of it was traced to the Nepal and Bangladesh borders, as in 2010 security forces seized Rs 1.17 crore worth of foodgrains like paddy and pulses being smuggled to Nepal, another Rs 60.62 lakh worth of grains were confiscated on the Indo-Bangladesh border.

The scam first came into light in 2003, during the Chief Minister ship of Mulayam Singh, in Gonda district in the distribution of foodgrain meant for the Sampoorna Grameen Rozgar Yojana and soon complaints started pouring in from other districts as well. After initially ordering an inquiry into the scam Mulayam Singh withdrew it. The Special Investigation Team ( SIT) set up by the Mulayam Singh government in 2006, lodged over 5,000 FIRs. Subsequently the next UP chief minister Mayawati upon assuming office, ordered a CBI probe into the scam on December 1, 2007. Media dubbed it, "mother of all scams", and TV news channel, Times Now reported the scam which started in 2002, under the reign of following Chief Ministers of Uttar Pradesh, estimated to be at over INR200,000 crore (US$40.56 billion).  Uttar Pradesh as with other states and UTs, is allocated a monthly quantity of foodgrains, i.e. rice and wheat, by the Central government for distribution amongst AAY, BPL and APL families, under TPDS managed by the state government. For the period from Apri1 2010 to March 2011, this quantity for the state was 528395 tons.

The latest of the scam series in India, initially referred as the 'UP rice scam' could be the biggest of them all, even outdistancing the so called 2G Spectrum scam. The scam involves goofing up of rice worth INR200,000 crore (US$40.56 billion). It was a scam that stretched to almost 7 years and 300 FIRs. The scam was reported in UP (Uttar Pradesh, India) between the years 2003-2007, the period when Samajwadi Party leader Mulayam Singh Yadav was the chief minister of the UP.

Andhra Pradesh Industrial Infrastructure Corporation Controversy

Andhra Pradesh Industrial Infrastructure Corporation Ltd also known as APIIC has been embroiled in a controversy over land acquisition for the Boulder Hills project in Hyderabad, a joint venture with EMAAR-MGF. News reports suggest that the APIIC agreed to dilute the public stake by undervaluing the land that it contributed. About 500 acres of land was acquired by APIIC in 2002-2003 for setting up a golf course and residential properties. Of the 535 acres of land in Manikonda near the Indian School of Business, APIIC sold 285 acres at 27 lakhs per acre as against the prevailing price of 1 crore per acre in 2003. The remaining 235 acres (and an additional 15 acres of unusable land) were allotted as a 66 year lease with a 2% share of the Golf course revenues. EMAAR sold this project to EMAAR-MGF and diluted the value of APIIC's stake from 26% to 4%, by not considering the prevailing market rate for the land in 2009.

Multiple claimants to the land have emerged, including the WAKF board and the previous farmer owners of this land. The customers who have paid for properties in the developed project are in jeopardy due to the unclear land title. On the back of the controversial Boulder Hills deal with EMAAR-MGF, several other APIIC projects, including the Raheja Mindspace IT park, that were approved in the period between 2003 and 2009 are being questioned. There are allegations of irregularities in land deals during the Chief Ministership of Y.S. Rajasekhara Reddy.

There are also allegations that government officials were allocated parcels of the property at deeply discounted prices compared to the prevailing market price. Officials who previously ran APIIC and seem to have conflicts of interest with the developers, have refuted many of these allegations and defended earlier land allotment decisions.

There have been several calls for a thorough investigation into APIIC deals either by the CBI or by the state investigative agency CID. Though there were initial reports of an external audit, the calls for a CBI enquiry were downplayed by the Andhra Pradesh Government, which has initiated an internal APIIC probe.

Land Scam: Lavasa Scandal

The Union environment ministry has issued a show-cause notice to Lavasa Corporation, which is constructing a 25,000-acre hill township near Pune, alleging myriad violation of environmental laws. The company, promoted by a clutch of investors led by Hindustan Construction Co, will have to stop construction work immediately.

The notice from the ministry continues a high-profile crackdown by Jairam Ramesh, the environment minister, on violators of India's hitherto loosely-enforced environmental laws. The high-profile project, described as independent India's first hill city, may get away by paying a "hefty penalty" according to sources in the environment ministry.

This penalty will have to be paid if the company is unable to explain violations including construction above 1,000 metres from the sea level, and construction without prior clearance over an area more than 20,000 sq.mts. The second phase of the project is unlikely to receive clearance in the wake of the new findings, they added.

The move pulled down HCC stock, and may impact the company's proposed initial public offering. On Friday, after the news of the show-cause notice to Lavasa, shares of Hindustan Construction Company slipped 19% to close at Rs 40 on the National Stock Exchange.

The stock had declined 11% and 2.9% on Thursday and Wednesday after Lavasa's name cropped up in an unrelated scam involving alleged payment of bribes by a number of companies, largely real estate forms, to bank officials. News of that scam broke on Wednesday.

It came out that the company had used Money Matters, a debt arranger at the heart of the scandal, for some property transactions. Ajit Gulabchand, the chairman and managing director of HCC, has said these transactions were completely legal. The environment ministry had sought a report from the Maharashtra environment department in June after a complaint by an NGO called the National Alliance of People's Movement.

The state government arm responded in August saying that a no-objection certificate by it was later converted into a final environmental clearance based on two assumptions: buildings had been built below 1,000 metres, and the proposed construction was limited to an area less than 2,000 hectres. Both limits have been breached, the stare government's report says.

The Union ministry has been able to intervene due to an Environment Impact Assessment Notification issued in 1994 (later amended in 2004), according to which any new industrial estate that had commenced without central clearances under the notification, will now be required to do so if construction work had not commenced as on July 7, 2004, or if the expenditure occurred till that date had not exceeded 25% of the sanctioned project cost.

According to the report by the Maharashtra environment department, the project cost incurred by the 2004 threshold was only 5.33% of the total cost. The project, which has often been linked to Union agriculture minister Sharad Pawar, will now have to get fresh clearances from the ministry.

Mr Pawar, in a recent newspaper interview, had strongly defended the project, saying it aimed to create a modern hill station, something which had ceased after independence. Mr Pawar had said in the interview that he had personally identified the areas where such a hill station might be set up.

The Union environment ministry's intervention might affect the company's plan to float an initial public offering (IPO). The company had filed a draft red herring prospectus with the market regulator and last week and the Securities and Exchange Board of India had approved the proposal.

The corporation aims to raise Rs 2,000 crore through its IPO. A company spokeswoman refused to comment in detail on the showcause beyond saying, "we have received the notice and senior management is studying the same and contemplating a response".

HCC owns 64.99% stake of Lavasa Corporation. Other major investors include Gautam Thapar's Avantha Group with 16.25%; Venkateshwara Hatcheries, which recently bought the English Premier League club Blackburn Rovers, with 12.8%; and individual investor Vinay Vithal Maniar with a 6% stake.

A number of banks have significant exposure to the Lavasa project. These include ICICI Bank (Rs 250 crore), Axis Bank (Rs 225 crore), Bank of India (Rs 150 crore), Allahabad Bank (Rs 500 crore) IndusInd Bank (Rs 500 crore), Andhra Bank (Rs 250 crore), Union Bank (Rs 500 crore) and Jammu & Kashmir Bank (Rs 100 crore).

Earlier this year, an inquiry by the state government suggested the Lavasa deal has deprived Maharashtra of revenue. An inquiry conducted by the Maharashtra revenue department says that Lavasa bought 600 hectares of land from farmers who had been given land by the state. Lavasa should have paid 75% of the price of the land to the state, therefore. Instead, it paid 2% to the government.

But company officials say that Lavasa bought 350 hectares, not 600 hectares as stated in the report. It paid 2% because the collector's office demanded this amount. The government report also says Lavasa bought 98 hectares of tribal land without the prerequisite clearance from the government, a charge Lavasa denies completely.

The report also finds fault with the state's irrigation department MKVDC for leasing 141 hectares of land at throwaway rates to Lavasa. The government at no point sanctioned this lease and while the market price should have been Rs 20 crore a year, the lease was signed for Rs 3 lakh a year. Lavasa argues that the lease- signed in 2002 was based the price based on the market rates at that time.

India Scandal Belekeri port scam

The Belekeri port scam relates to 3.5 million tons of confiscated iron ore that was exported illegally from Belekeri port near Karwar in Karnataka. After Deputy Conservator of Forests R. Gokul seized the ore and the high court refused to permit it to be exported, a large part of it was surreptitiously exported from the port. After persistent protests and public pressure, Karnataka Chief Minister Yeddyurappa, who is balancing political considerations with control of corruption, admitted to an illegal iron-ore export racket at Belekeri Port involving 35 lakh metric tonnes of iron ore. It is said that the scam was worth an estimated 60,000 crore rupees.

This iron ore from the Bellary region is alleged to have been illegally mined after paying a minuscule royalty to the government. The major irregularities involve mines in Bellary, including those of Obulapuram Mining Company owned by G. Karunakara Reddy and G. Janardhana Reddy, who are ministers in the Government of Karnataka. A report constituted by the Lok Ayukta uncovered major violations and systemic corruption in mining in Bellary, including in the allowed geography, encroachment of forest land, massive underpayment of state mining royalties relative to the market price of iron ore and systematic starvation of government mining entities.This report was finalized and prepared with inputs from the Income Tax Department's Commissionerate of Central Circle.

Justice N. Santosh Hegde resigned from the Lokayukta position on 23 June 2010 after an honest officer (Deputy Conservator of Forests R Gokul) was suspended by order of minister J. Krishna Palemar and he felt powerless to help. He expressed inability to be effective in his anti-corruption mandate owing to a non-cooperative Government of Karnataka. Amid media speculation that the ports minister Krishna Palemar had recommended Gokul's suspension on behalf of some politicians with business interests, Palemar defended his recommendation to suspend Gokul, saying Gokul had failed to attend a meeting, and "this raised suspicions that he too might have had a role to play in this particular incident. Because of this I recommend that he be placed under suspension".

Hegde's resignation sought to underline the helplessness of the advisory post of the Lokayukta in such situations. The resignation has brought considerable public attention on the scam, whose existence the government has also been forced to admit.