Black Money abroad - is it fiction or non-fiction?

Akanksha1982 · Oct 28, 2014

There is a lot of talk about black money being stashed abroad by Indians - Politicians, entrepreneurs - by everyone except the ones who talk about it.

So, i started thinking the logistics of black money abroad and how i would do it.

So, assume i am that corrupt person who has looted wealth of commoners. This is black money so i can't keep it in bank. So everywhere in my house is black money. All my utensils have black money. Great. Now what to do?

Someone tells me that i need to open an account abroad and stash it there. But i can't open an account abroad with indian currency. It has to be local money or US dollars. So how do i convert billions and billions of rupees to dollars or other currency?

oh ok there is another way, i am a minister, i approve money to buy military equipment or something like that. I ask for a cut from the company to deposit my cut in the foreign bank.

Ok Assume that either way i somehow got it converted. Now I have to open an account. So if I am that intelligent and smart as to loot billions of rupees, at least i should be given the credit of being that smart as to not open an account with my name/address, finger print or anything that could point to me.

So i need to find someone whom i can trust to open the account. But this person would then have the information of the account and could also take away the money. Is stealing from a thief immoral or a crime? How would i find such a person who would be honest and keep my secret till life?

Ok. Assume i found such a person opened an account and put the money there. What next? I want to buy a mansion, yacht etc. Oh but i can't buy them. I have to maintain my image of a commoner. I have to live a simple life style.

So what do i do with that money? Why would i go through all the trouble to hide it in a foreign bank and never be able to use it? Why wouldn't i keep it in my utensils and use it here to increase my power and influence, to win the next election?

So i am confused as to why would anyone who is smart enough to loot money would put it in banks abroad?

Industrialist, movie stars may open foreign accounts to hide their income from abroad and they use it to buy expensive cars, real estates in other countries (dubai) or spend when they travel to other countries.

I am sure I am missing something. BTW, i do have a foreign account in India.

parineetha · Oct 28, 2014

Fictitious or non-Fictitious, The moral of the story - It doesn't matter if a cat is BLACK or WHITE, so long as it catches mice.
But nice RCA!

Balajee · Oct 28, 2014

Many people get confused between having foreign accounts and holding black money. Many Indian firms have become multinationals (eg Tatas) and are making acquisitions abroad. Such firms cannot do without having accounts abroad.There are also many persons of Indian origin who have foreign accounts but later come and settle down here without closing the accounts.and that is not necessarily illegal. As for black money abroad it doesn't stay fropzen there. Our rulers have set up mechanisms to help the black money holders to bring the money back into India . There is, for instance the Indo-Mauritian trade agreement which enables the black money holders including corrupt politicians to set up dummy companies in Mauritius and use them to bring back the money into India. There are also instruments which ensure that people can invest in India without their identities being known! The investor could be anybody--a terrorist, mafioso, corrupt politicians and businessmen. When such instruments exist talking about flushibng out black money held in foreign banks doesn't make sense because the money doesn't stay frozen there.

Akanksha1982 · Oct 28, 2014

Balajee said: ↑

Many people get confused between having foreign accounts and holding black money. Many Indian firms have become multinationals (eg Tatas) and are making acquisitions abroad. Such firms cannot do without having accounts abroad.There are also many persons of Indian origin who have foreign accounts but later come and settle down here without closing the accounts.and that is not necessarily illegal. As for black money abroad it doesn't stay fropzen there. Our rulers have set up mechanisms to help the black money holders to bring the money back into India . There is, for instance the Indo-Mauritian trade agreement which enables the black money holders including corrupt politicians to set up dummy companies in Mauritius and use them to bring back the money into India. There are also instruments which ensure that people can invest in India without their identities being known! The investor could be anybody--a terrorist, mafioso, corrupt politicians and businessmen. When such instruments exist talking about flushibng out black money held in foreign banks doesn't make sense because the money doesn't stay frozen there.
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Sure one can do with small amounts of money. But look at the amount of money, people are talking about - billions and billions of dollars per individual. If such amount is transferred as FDI, reserve bank and many others will know about it. If someone knows someone will come forward and tell.

There is a lot of black money in India itself. Let's clean that first. How many merchants and shop owners pay taxes? How many people pay full taxes on the property that they purchase - flat, house or land?

tashidelek2002 · Oct 28, 2014

Don't you think that organized crime has devised ways to hide money for a fee?

Akanksha1982 · Oct 28, 2014

tashidelek2002 said: ↑

Don't you think that organized crime has devised ways to hide money for a fee?
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Billions and Billions of dollars for a long time? And if one is in politics, many would like to pull you down if they have the information.

persecutedDIL · Oct 29, 2014

Akanksha1982, black money in Indian currency can be easily converted into foreign currency because there are criminals abroad too, who would charge a hefty fee for this conversion. An exporter of goods to India from abroad may agree to pay in Indian currency and can have a deal with this black money looter to present this money in return for foreign currency after taking the cut. Black money can be converted into foreign currency through hawala route as well.

People stash black money abroad because there are tax havens abroad and not every bank has strict KYC norms. Such people will always be HNI clients and in the lure of attracting or retaining such HNIs, banks promise privacy and freedom from scrutiny.

If some people in India ask you for your dollars in return for Indian money in cash form which you would need when you travel to India, so you hand them over your dollars and they give you INR cash - beyond a certain point even that is illegal.

tashidelek2002 · Oct 29, 2014

The crooks money launder by converting to other currency and from that perhaps a bank account in some non reporting country or you just invest it in some real estate or stocks and even just put the money in some vault. I think they would use a number of avenues to spread it out so even if some is found the rest is safe. Mafia here hides all sorts of money in investments like casinos (Las Vegas not the Indian reservations). I saw the other day they are now into prescription drug business. This whole thing is a big business in itself.

Akanksha1982 · Oct 29, 2014

persecutedDIL said: ↑

Akanksha1982, black money in Indian currency can be easily converted into foreign currency because there are criminals abroad too, who would charge a hefty fee for this conversion. An exporter of goods to India from abroad may agree to pay in Indian currency and can have a deal with this black money looter to present this money in return for foreign currency after taking the cut. Black money can be converted into foreign currency through hawala route as well.

People stash black money abroad because there are tax havens abroad and not every bank has strict KYC norms. Such people will always be HNI clients and in the lure of attracting or retaining such HNIs, banks promise privacy and freedom from scrutiny.

If some people in India ask you for your dollars in return for Indian money in cash form which you would need when you travel to India, so you hand them over your dollars and they give you INR cash - beyond a certain point even that is illegal.
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Yeah it is possible to do all that for some lesser amount like a million or tens of million.

The media is saying it is of the amount of Billions of dollars some put it at $ 2Trillion. Is it possible for anyone to do that for billions of dollars without any one knowing it?

Is someone thinking of how it is possible or just throwing out numbers as they think? I can understand BJP being in politics can say anything but Media has to be responsible.

Akanksha1982 · Oct 29, 2014

tashidelek2002 said: ↑

The crooks money launder by converting to other currency and from that perhaps a bank account in some non reporting country or you just invest it in some real estate or stocks and even just put the money in some vault. I think they would use a number of avenues to spread it out so even if some is found the rest is safe. Mafia here hides all sorts of money in investments like casinos (Las Vegas not the Indian reservations). I saw the other day they are now into prescription drug business. This whole thing is a big business in itself.
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Yes. but can people do that billion of dollars ($500 billion by some media) without anyone knowing it? That is more than the market caps of Google or Microsoft.

And even if someone do all that, how is that person going to use all that money staying in India? Why wouldn't the person hide it in India itself and use it for their own progress (winning elections, buying votes inside parliament, etc)