Chennai court convicts man of money laundering in forged foreign remittances case

New Delhi: A Chennai court on Friday sentenced a 43-year-old man to 3.3 years' rigorous imprisonment under the anti-money laundering law in a case linked to the transfer of over Rs 14 crore abroad in the guise of merchandise export payment, the ED said.

The convict, Mohammed Riyaz, was arrested by the federal agency on July 4, 2019.

The special court also slapped a fine of Rs 6 lakh on him, the Enforcement Directorate said in a statement.

In case he defaults on the fine amount, it said, the man would have to undergo rigorous imprisonment for two more months.

Riyaz was arrested by the ED for making foreign outward remittances of USD 2,184,785 (Rs 14,48,06,480.90) in two assumed names/father's names/date of birth through Syndicate bank, Armenian Street Branch, Chennai, during the period from 10.08.2015 to 30.09.2015 derived out of cheating by impersonation and using forged documents, the ED said.

He projected the funds as payment for permissible merchandise imports without making corresponding imports into the domestic tariff area (DTA), it said.

The ED said the case had "cross-border implications and therefore, the special court and the high court, consistently took the stand to not grant bail to the accused, considering the seriousness of its implication to the financial system and the sovereignty of the nation, and further the high court gave direction to complete the trail in a time-bound manner".

It added that the case was being monitored by the Central Vigilance Commission (CVC) and it pertains to an instance of trade-based money laundering.

"The prosecution complaint (chargesheet filed by the ED in the case) withstood all the legal challenges and finally established it (money laundering) as a stand-alone offence, while the investigation in respect of schedule offence is still in progress," the ED said.

The PMLA case was filed by the ED in September 2017 after studying a CBI FIR that was registered against the accused an year ago in the month of October.

"The accused is a part of the gang of people operating with complete anonymity in the matter of sending the proceeds of crime under the guise of permissible merchandise imports, without making corresponding imports into the DTA by using forged import documents as genuine.

"There are 57 such business entities involved in this scam in the matter of sending (foreign remittance) Rs 3,500 crore," the agency said.