Enforcement Directorate (ED) unearthed a racket of illegal demonetised notes. As part of its money laundering investigation, it arrested seven middlemen and seized Rs 93 lakh in the new currency of Rs 2000 in Karnataka late yesterday.
According to the officials, the seven accused including a government official were arrested under provisions of the Prevention of Money Laundering Act (PMLA).
Officials said that the action was taken after the Income Tax department had seized Rs 5.7 crore cash in the new currency and the ED had booked a money laundering case against a government engineer and others based on a CBI FIR in the case.
The officials further said the money laundering was unearthed after the ED officials posed themselves as customers who wanted to change their old currency illegally and they paid commission to the alleged middlemen.
Official added that these middlemen were charging a commission between 15-35 percent. They said that the agency suspected that there is a chain of middlemen who involved in converting black money into white. The middlemen also had links with bank managers.
The investigation revealed an illegal currency exchange mechanism between black money holders and senior bank employees.
After the demonetisation, more than Rs 250 crore in new currency notes has been seized in multiple raids carried out in different parts of the country in last one month. The Home Ministry has also looked into the matter and suggested the banks to closely observe the situation.