Two phones recovered from Parasmal Lodha, the Kolkata businessman-realtor arrested by the Enforcement Directorate (ED) late Wednesday for alleged illegal conversion of old currency into new notes, are being described by agency officials as a “treasure trove” and a “digital diary of the who’s who of the political world”.
Lodha was arrested by the ED from Mumbai in connection with the recovery of a large amount of new currency notes from a Delhi law firm belonging to advocate Rohit Tandon and Chennai businessman Sekhar Reddy.
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Arrested by the CBI, Reddy has been at the centre of of an Income Tax crackdown — 14 of his premises have been raided and I-T officials claim to have seized Rs 132 crore in currency notes including Rs 34 crore in Rs 2,000s, as well as 177 kg gold. The ED is investigating the Lodha-Reddy link.
ED sources told The Indian Express that the “digital diary” of Lodha reveals he was offering his services to the “entire spectrum of political personalities”. His WhatsApp chats, sources said, show he was offering conversion of notes at the rate of 20-25 per cent.
After the raid on Tandon’s law firm, sources said Lodha deleted “a lot of data” from his two phones but the ED recovered the data with the help of experts. The ED is verifying Tandon’s statement before the I-T and Delhi Police Crime Branch with the help of Lodha.
Sources said Lodha told the ED that in the recent past he had helped a lawyer and a leading politician’s son buy houses in Jor Bagh in New Delhi, and that he was instrumental in “managing” the “cash part” of the transactions.
Less than a fortnight after the demonetisation announcement, when the government realised that tax evaders and hoarders were “successfully converting black money into white”, a high-level group comprising officers from the CBI, FIU, ED and CBDT was formed.
Intelligence officers also joined some of these meetings with their inputs.
This group, sources said, found that “shadowy transactions” had taken place — through bankers, by buying gold with back-dated receipts (pre-November 8), by depositing money in fake accounts and then withdrawing it through RTGS, and via “book entries” in accounts of the poor.
In coordinated efforts, the group tracked people who had cornered new notes illegally. In the first round, 67 hawala operators were raided and another 34 were searched in the next round.
Sources described Lodha’s arrest as a “prized catch” because they believe it will help uncover a “countrywide network of people who took advantage of the situation after November 8”.
“After November 8, black money became a commodity in the underworld money market. There was a price attached to it. If someone had Rs 1 crore in old notes, it was seen as a great business opportunity to make quick money. Old notes worth Rs 1 crore were bought with new notes of Rs 75 lakh and then the existing underground network was used to convert this latest purchase. There were tie-ups with people who would go to banks with, say, 500 or more KYC forms to get new notes. They also created fake accounts overnight, paid bribes to bankers and took new notes from the cash chests,” ED sources said.