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Indians have stashed over $500 billion in banks abroad
Indians are the largest depositors in banks abroad with an estimated
$500 billion (nearly Rs 24.5 lakh crore) of illegal money stashed by
them in tax havens, the CBI director said on February 13, 2012. India, in particular, has suffered from the flow of illegal funds to tax
havens such as Mauritius, Switzerland, Lichtenstein, British Virgin islands etc.
"It is estimated that around $500 billion of illegal money belonging to
Indians is deposited in tax havens abroad. Largest depositors in Swiss
banks are also reported to be Indians," AP Singh said speaking at the
inauguration of first Interpol global programme on anti-corruption and asset recovery.
He said getting information about such illegal transactions is a time
taking process as investigators have to peel each layer by sending
judicial requests to the country where such deposits have been made.
He said there is a lack of political will in the leading tax haven
states to part with the information because they are aware of the extent
to which their economies have become "geared to this flow of illegal
capitals from the poorer countries." He said the World Bank estimates the cross border flow of money from
criminal activities and tax evasion is around $1.5 trillion of which $40
billion is bribe paid to government servants in developing countries.
Denmark and Finland passed information on 2,000 bank
accounts to India
Even as the details given by France on Swiss bank accounts of
Indians continue to cause ripples back home, Denmark and Finland have
passed information about another 2,000 bank accounts to India, prompting
the I-T department to launch an investigation on November 5, 2011.
Bank of Liechtenstein and Geneva-based HSBC had shared the details
of Indian accountholders. Another trenches of information is on its way
from Germany. The DCI is probing accountholders of HSBC Bank in Geneva, where the
deposits run into thousands of crores in Indian currency. The details of
700 accounts in the Geneva bank had thrown up many high-profile names,
including industrialists and politicians having huge deposits.
Second list of Indian Swiss accounts to be shared
A second list containing names of Indians, who have stashed
black money in Swiss banks, will be shared by the Germans, Times Now reported on September 14, 2011.
Sources said that the list has 100 plus Indian names - most of whom have
accounts in the Julius Baer bank - the same bank which has launched a witch-hunt against its former employee and
'whistleblower' Rudolph Elmer.
Names of 18 Indians, who had stashed away nearly Rs 40 crore in tax
havens, were revealed early this year. The Liechtenstein list, accessed
by the Germans and shared with the Indians was the first ever to make such valuable information available.
However, now a second revelation is in the offing. Sources have told
Times Now, that a second list will soon be released to the Indian
government. The list contains names of a 100 plus Indians who have stashed away
black money in leading Swiss banks. Among them is also - Julius Baer - the same Swiss bank which is now
trying all legal means to retrieve information handed over by 'whistleblower' and sacked employee Rudolph Elmer to WikiLeaks founder Julian Assange .
Some of the names that the WikiLeaks founder is privy to are likely to
figure in this highly anticipated 2nd list of Indian tax evaders. The
German ambassador confirmed to Times Now that a announcement was in
the pipeline. Sources said that tax authorities have already begun the process of
collecting nearly Rs 25 crore in penalty from the 18 tax evaders, who
figure in the Liechtenstein list.
India's Black money in Swiss banks list revealed
The
veil of secrecy on the list of Indians who stashed black money in foreign banks has finally been lifted on February 4, 2011. Tehelka
has revealed the names of 15 Indians, who have stashed their black money in the LGT bank of Liechtenstein , a well-known tax haven
nation, 190 km from Munich , Germany. The magazine claims it has has accessed 16 of the 18 names, and has made 15 of them public.
The Tehelka report claims Germany had officially handed over the list to the Indian Government on 18 March 2009. Which means it is
almost two years since the Indian Government had information about the names and bank account details of these eighteen Indians.
India's Black money in Swiss banks
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Recently, the Swiss Bankers Association, under pressure from the Swiss Government, has revealed information on
black money of several nations deposited with it. However, the details of the depositors have not been disclosed. Thus a whopping
Rs 65,223 trillion of Indians is deposited in the Swiss banks.
According to the Swiss banks, India stands at the top
position; second comes Russia and China is at fifth place. The names of countries at third and fourth place is not yet out.
Similarly, Americans too have deposited their money in the Swiss banks whose information has also been given to the US government.
Every nation has signed accord with the Swiss government. India and Switzerland have agreed to implement Double Taxation Avoidance
Agreement. According to an agreement information of a person
pertaining to an economic offence can only be given.
According to the Swiss Bank Association, Indians have
topped the list of black money depositors at the famous Union Bank
of Switzerland (UBS). Indians have deposited 65 thousand 223 billion amount in the Swiss Bank. It is the first time when the
exact amount has been revealed by the Swiss Bank Association. After the disclosure, it will be interesting to see what action
will be taken by the Indian government in this regard.
Supreme Court probe Black money issue
The Supreme Court on July 4, 2011 appointed Special Investigation Team (SIT) headed by a former SC judge to probe
black money issue. Former SC judges - Justice B P Jeevan Reddy and Justice M B Shah - will be the chairman and vice-chairman of the
SIT. The team will also include chiefs of the Intelligence Bureau (IB) and Research and Analysis Wing (RAW).
The SIT will file first status report in the third week of August 2011. The apex court slammed the government for its
lethargy in getting the black money back. The court asked the government to disclose names of foreign bank holders against whom
I-T proceedings have been concluded. It also told the government that it could not have agreed with other countries under double
taxation avoidance treaty not to disclose names of foreign bank account holders who have deposited illicit money abroad.
The Supreme Court also severely criticized the government's delay in probing black money, Hasan Ali Khan and others and said
this was not only against the constitutional mandate but also akin to putting national security in danger.
The Supreme Court has criticized the government for its handling of black money planted by industrialists and others
in foreign bank accounts on January 19, 2011. "It is a pure and simple theft of the national money. We are talking about
mind-boggling crime...it's not about treaties," said the court. The case is based on a petition filed by former Law
Minister Ram Jethmalani and others to retrieve black money being held in foreign banks.
The government has submitted to the Supreme Court a list of
26 Indians who have accounts in tax haven Liechtenstein's LGT Bank but has said these names should not be made public because it
would violate an agreement between India and Germany.
Efforts to bring back black money
Efforts to bring back black money stashed in Swiss banks,
India is set to seek information on specific accounts there through the Federal Court of that country. The Finance Ministry
has initiated steps under which the Swiss Federal Court of Justice would be requested to ensure that information on specific accounts
is provided by April 1, 2011 under the Mutual Legal Assistance Agreement.
In August this year, India and Switzerland had signed a protocol to amend the existing DTAA between the two countries so
as to bring under its ambit information regarding the money stashed away in banks in that country.
The Swiss parliament on June 22, 2011 gave approval to amendments to tax treaties with countries, including India,
that makes it easier for them to access information about the illegal funds held by their nationals in Swiss private banks. The
upper house of the Swiss parliament endorsed amendments to double-taxation agreements (DTAAs) in line with internationally
applicable standards.
The latest public figure to join the anti-graft bandwagon, of course, has been Yoga Guru Baba Ramdev who
launched a Satyagraha movement to bring back black money stashed
in Swiss banks. Baba's fast has created quite a stir. He coerced the UPA government into giving written assurances about the
latter's commitment to bring black money back into the country and to clamp down on corruption.
It saw the government coming down hard on him and
his followers and break up the fast in a midnight clampdown.Rights activists have rightly pointed out the high-handed manner
in which the government dealt with Baba and his fasting followers. They have also justifiably criticised imposition of Article 144 at
the Ramlila Maidan as Baba's agitation was completely peaceful and never threatened the law and order situation.
Indians, cutting across caste, class, religion and social standing, are unitedly voicing a demand for the black money to be
brought back. But how would the money be used in case the UPA government, reeling under multiple exposes of scams and financial
irregularities, balks under popular pressure and manages to bring it back? |
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Switzerland
is willing to share information
Switzerland is willing to share information on Indians holding secret bank accounts there as part of New Delhi's effort
to bring back an estimated $1.4 trillion black money in tax havens
abroad, the country's envoy Philippe Welti has said.
"We now have an agreement with the Government of
India. Under it if the government sends us a request, we will comply and provide the necessary information, which is asked of
us," Welti told IANS in an interview. Finance Minister Pranab Mukherjee had said last month
that secrecy clauses in India's treaties with other countries were preventing the government from disclosing the names of Indians
with black money abroad, estimated at $462 billion to $1.4 trillion.
Finance Minister Pranab Mukherjee
The government, he said, had also submitted the names of
some suspected offenders in a sealed cover to the Supreme Court, which had asked the executive to be more serious on black money,
as it constituted a "plunder" of the nation's wealth. Mukherjee also said notices were served on 17 Indians suspected of
having black money abroad, but ruled out revealing their names. He
said their names will be out only when prosecution starts.
Indian cricketers, filmstars have black money in Swiss banks: Whistleblower
Whistleblower Rudolph Elmer has said on September 12, 2011 Indian cricketers and film stars
hold secret accounts in Swiss banks. While refusing to give out the
names of the evaders, Elmer accused the Indian government of not doing enough on the black money front.
"There is a need for global commitment and action," Headlines Today
news channel quoted Elmer, who was released from jail on July 25, 2011,
as saying on September 12, 2011. In his first interview after being released from jail, Elmer told the
channel that there is a need for global commitment towards tightening
noose around tax evaders, who he said are criminals. Fearing reprisals, Elmer declined to reveal the names of the
"politicians, cricketers and filmstars". He said it's "all about approach", saying if the Indian government was at all serious about
bringing back black money it could.
"The government is not committed. I think society has to put pressure on
the Indian government to act. India is a big country, which is getting
stronger by the day. It has the negotiating power," Elmer told "Headlines Today".
Saying he can't give names because "I'll in serious problem", Elmer told
/Headlines Today/, "I can't give a date, but it will happen sometime".
He added the government was not doing enough. Rudolf Elmer is a former employee of Swiss bank Julius Bar, a highly
reputed Swiss bank.
He shook the world in January this year when he handed over to WikiLeaks
a CD containing 2000 names of tax evaders. In that list figured the names of several Indians. (Source: DNA - Sep 12, 2011)
Black money issue in general election 2009
In the general election 2009, BJP leader LK Advani
and yoga guru Baba Ramdev had raised the issue of black money deposited in Swiss bank. The claim made by L.K. Advani on the
campaign trail in 2009 that up to $1.4 trillion has been squirrelled away in Swiss banks.
Indian Government to seek recall of SC black money verdict
The Union government on July 15, 2011 decided to move Supreme
Court seeking total recall of its stinging judgment taking over the
probe into black money while accusing the government of probing the
sensitive economic issue laggardly.
Riled by the appointment of a Special Investigation Team (SIT) headed by
a retired judge of the apex court, the Centre will on Friday file an application faulting the judgment on the ground that it amounted to the
judiciary taking over the executive's statutory functions and that the
entire order be scrapped. The application drafted by the finance ministry traces case laws to
drive home the sanctity of separation of powers under the constitutional
scheme and says the July 4 judgment by Justices B Sudershan Reddy and S S Nijjar violated the cardinal principle.
The SC had on July 4, 2011 stunned the Centre by slamming it for lacking in
vigour to probe black money and took over the probe by setting up multi-discipline SIT to investigate the crime in India
and abroad as well as accused Hasan Ali Khan.
In India, multi-billionaire businessman Hasan Ali Khan has been facing
investigation for alleged money laundering, which has put immense pressure on the ruling United Progressive Alliance (UPA) government to
get tough on black money issue. Hasan Ali Khan
is estimated to have allegedly stashed away over $8 billion in an account in financial
services firm UBS at Zurich in Switzerland.
A new report
A new report by Global Financial Integrity estimates that some Rs 20,79,000 crore was was illicitly taken out of India
between 1948 and 2008, at the present value of money. The new report argues quite convincingly that tax evasion by rich Indians
and companies is an important driver of illicit capital outflows. In 2008, black money in India amounted to Rs 28 lakh
crore. Just half of that could retire India's foreign debt.The remaining would be enough to give every Indian Rs 14,000.
According to several economists and financial experts, bank deposits in the territory of Switzerland by
nationals of India total upwards of $1.4 billion. That is close to the nominal GDP of India today. IT kind of gives credence to the
widely held belief that $1.456 trillion of Indian money is parked in Swiss bank vaults.
According to Global Financial Integrity -- a non-profit organisation -- the estimated value of illegal financial flows
held abroad is around $500 billion. While calculating this into Indian money, the amount comes up to a whopping Rs 22.5 lakh crore(Rs 22.5 trillion).
The British example tackling black money
Secret accounts in tax havens happen to be a chronic problem with several Western nations also. In October, 2010, the
British and Swiss Governments signed a joint declaration to work towards taxing Swiss bank accounts owned by British citizens.
Swiss banks will be obliged to tax interest payments to British Bank holders probably at a rate of 50 per cent on income
from Swiss bank accounts. Such taxes collected by Swiss banks will be remitted anonymously to the British Treasury authorities.
Apart from this withholding tax, investors will also have to pay a separate levy towards unpaid taxes in the past. Swiss
bank will also require their British clients to show that they have complied with British tax laws. The names of account holder
will be kept secret but taxes due thereon would have been collected and remitted to the U.K treasury.
According to one estimate, the amount of income and wealth belonging to Britain kept in Switzerland will be of the order of
$125 billion. The UK may gain £6 billion by this device. The names of secret account holders may not be revealed, but Revenue
will gain. India may look around the world to see how other countries are tackling this menace.
SIT in black money can't act as "super power" Centre tells Supreme Court
The Centre on Wednesday the 24th August 2011 told the Supreme Court that the SIT
appointed by it to probe and unearth the black money stashed abroad
needs to be scrapped as the investigating agency cannot function like a "super power."
Attorney General G E Vahanvati making a plea for recall of the apex
court's July 4, 2011 order on the SIT said the Government had "very serious"
reservations on the directions which had also cast aspersions on sincerity of the Government in tackling the black money menace.
"It (SIT) can't act as a super power or you forget Parliament. If the SIT has to function it needs funds. But it is finally Parliament which
has to approve it," Vahanvati told a bench of justices Altamas Kabir and
S S Nijjar. He alleged that the earlier bench headed by Justice B Sudershan
Reddy(since retd) of which Justice Nijjar was a member had passed an erroneous judgement in which it was commented that the Government was
weak, soft and hand-in-glove with mafia elements. "We had passed the orders after going through the proceedings. The team
is the same except the two judges," the bench remarked pointing out that
the SIT was initially constituted by the Centre and the apex court had
incorporated the names of retired SC judges justices B P Jeevan Reddy and M B Shah. |
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CNRI proposes informants cadre to tackle black money
A novel initiative to deal with the scourge of black money has been
suggested by the Confederation of NGOs in Rural India (CNRI), urging the
Government to create a cadre of social workers who would work as informants to intimate the authorities about those in
possession of unaccounted or black money. "Government should announce that a cadre of social workers (informants)
will be created all over the country and they will intimate the Government after 31/03/2012, if anybody is in possession of unaccounted
or black money. Such informants will be treated as social workers and
will be paid 10% of the amount disclosed by the defaulters", Mohan
Dharia, former Commerce Minister and Chairman of CNRI , has petitioned
to union finance minister in a note submitted for pre-budget consideration for 2012-13.
Will name Indians with Swiss accounts in 2012: Julian Assange
The names of Indians holding Swiss bank accounts may be revealed by
The WikiLeaks sometime next year,its founder Julian
Assange said on December 4, 2011.
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Switzerland and Zürich
Switzerland is known for its affluent and robust modern market economy.
The Swiss economy is deemed to be among the world’s most advanced and flourishing. In addition, the country continues to be a safe refuge for
investors, maintaining a degree of banking confidentiality.
Zürich
Zürich is Switzerland's chief cultural and commercial centre, is broadly
considered to be one of the world's global cities and is the country’s
most important business centre. There are 356 banks in Switzerland
mostly in Zurich.
Many major financial institutions have their headquarters in Zürich,
including UBS, Credit Suisse, and Swiss Re. Most Swiss banks are
headquartered there, and the city is the world's principal centre for
offshore banking, in large part due to the secrecy of Swiss banks. More than a hundred foreign banks are based in this bustling city.
The Swiss Stock Exchange also has its headquarters in Zürich..
Zürich is very accessible for business travellers. The Zürich Airport is an international airport with connections to and from more than 180
destinations in about 80 countries throughout Europe, Africa, Asia and the Americas.
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India's black money in Swiss Bank
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