WASHINGTON: The State Department has claimed that investigations show that the Indian stock market scam may be tied to narcotics related activities and that the famous Medellin and Cali cocaine cartels of Colombia have been using the Indian banking System to launder drug money, AS reported earlier, these two cartels have been using an account in a bank in Punjab to launder money made from selling cocaine. It is, however, not clear whether the investigations into the stock market scam point to any specific links with the money laundering operations of the Colombian drug cartels and their Indian counter parts. Indian authorities investigating the securities scam have up to now kept both the Indian public and the Joint Parliamentary Committee (IPC) looking into the scam in dark about the possible drug money laundering aspects of the scam. And it has been left to the US State Department to make this information public. Joint investigations launched by the State Department and the Indian authorities also show that a Colombian drug kingpin was using a bank account in India to transfer money from the United States,
The annual “International Narcotics Control Strategy Report,” while discussing India’s role in drug related financial crimes and money laundering, notes: “Raids Conducted in August 1992 against a Colombian money launderer working for the Cali and Medellin cocaine cartels revealed that drug money was being deposited in an account in Punjab.
“A multilateral effort was recently initiated to target a well-known Colombian cocaine king pin who has used at least one bank account in India to facilitate the transfer of funds from the US.”
The report also says that “Al though there have been no arrests/ prosecutions for money laundering, investigations into a stock market scandal in Bombay have developed leads indicating possible Wes to narcotics related activities, “
Official Indian figures of heroin seizures, supplied by the Narcotics Control Board, show a drop in the percentage of heroin originating in South East Asia. However, according to the US authorities, “which are directly linked to greater use of injectable heroin, raises doubts that enforcement measures in the region accurately reflect the transit of South East Asian heroin through India and Bangladesh.
According to the report, the other important drug control problems in India relate to the diversion of its licit opium industry to illicit channels, illegal cultivation, and the illicit export of chemicals for processing heroin.
The report says that the diversion of licit opium occurs in Madhya Pradesh, Rajasthan and Utar Pradesh, the three states in which the Indian Government licenses poppy cultivation. Poppies, it notes, are also grown illicitly in the Himalayan foothills of UP and in northeast India near the Bangladeshi and Burmese borders.
Article extracted from this publication >> April 30, 1993
