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NEW DELHI — The Enforcement Directorate has unearthed a hawala nexus that used money earned from smuggling of human hair from India to China and other countries to carry out illegal betel nut trade from Myanmar and vice-versa, officials said on Tuesday.
The nexus came to light during a money laundering probe into the smuggling of human hair.
The federal probe agency filed a chargesheet in August last year before a special Prevention of Money Laundering Act (PMLA) court in Nampally, Hyderabad, bringing on record evidence of this purported modus operandi.
The court took cognisance of this PMLA prosecution complaint, filed against Lucas Thangmangliana, a resident of the Champhai district of Mizoram, Hyderabad-based Nayla Family Exports Pvt. Ltd. and 16 others, on March 1, the ED said in a statement issued on Monday.
The ED's money laundering case stems from an FIR filed by the Hyderabad Police against Nayla Family Exports Pvt. Ltd. and others.
The police pressed charges of using "benami" Import Export Codes (IEC) against the company for exporting human hair, cheating by impersonation, using forged documents and smuggling of human hair to Myanmar, Bangladesh, Vietnam and China from the Hyderabad airport and through land routes along the international India-Myanmar border in Mizoram, according to the ED.
The probe found, the agency claimed, that Lucas Thangmangliana arranged illegal border crossings for the smuggling of human hair and fertilisers from India to Myanmar through the international border in Mizoram.
"He also helped residents of Myanmar in smuggling of betel nuts from Myanmar to India and arranged cash payments in respect of above commodities through hawala networks," it alleged.
The modus operandi of "payment through hawala network" run by Lucas Thanmangliana was such that his associates received payments from the buyers of human hair and fertilisers smuggled from India to Myanmar in Kyat (currency of Myanmar), it said. And for the betel nuts smuggled from Myanmar, they took the payment from local Indian buyers in their currency and subsequently.
Subsequently, they made payments to betel nut sellers in Myanmar in Kyat from the fund collected by him from the buyers of human hair and fertilisers, the agency claimed.
It added that the Indian sellers of human hair were paid in local (Indian) currency from the funds received by him (Thangmangliana) from buyers of betel nuts in India.
Hawala denotes illegal and fraudulent KYC-based monetary transactions through both banking and non-banking channels.
Searches were conducted in this case by the ED in February, 2022 at various premises in Hyderabad and Mizoram leading to seizure of INR 1.21 crore in cash even as the agency froze more than 100 bank accounts having deposits of INR 7.85 crore.
"These (bank) accounts were used to deposit huge amounts of cash by persons other than the account holders. Human hair exporters from Hyderabad received cash payments from these frozen accounts and through hawala channels as differential payment for their highly under-valued human hair exports," the ED said.