How investigators traced Madhu Koda’s hawala connect

New Delhi: The first whiff that something had gone bad came 18 months ago, when officials from the Enforcement Directorate (ED) apprehended an individual at the Mumbai international airport as he was about to board an aircraft bound for Bangkok.

ED officials found in his possession travellers’ cheques in excess of Rs 6 lakh. Many of these cheques had been countersigned, which meant they were as good as currency. With the hawala business in a slump following the liberalisation of foreign exchange rules, the man was clearly carrying money abroad to launder it. The question ED officials needed to answer was: whose money was it?

But they were obstructed. A top minister in the Maharashtra government, originally from north India and related to this person, told them to go easy. ED didn’t close the case, the man didn’t go to jail: he was, however, questioned intensively.

Half a dozen politicians

The directorate is now in a better position to answer the questions raised then. Quiet investigations revealed the money belonged to half a dozen politicians. Painstaking research into mobile communication and intelligence gathering led ED to where it is today — getting ready to arrest former Jharkhand chief minister Madhu Koda and some of his friends.

The first five years of Koda’s life as a BJP legislator were uneventful: he used this time to consolidate relationships. But elections came around in 2005 and the BJP turned down Koda’s claim of a nomination. He contested as an Independent from his old constituency and won.

This was the time Koda — along with friends Kamlesh Singh and Bandhu Tirkey — discovered he too had some value. Koda agreed to support a BJP-led government led by Arjun Munda, taking over as the minister of mines. But Munda’s government lasted only till September 2006 when Koda and his friends dislodged the NDA government to pave way for the United Progressive Alliance (UPA) government with Koda at its head.

Just who were Koda’s friends?

The 2005 elections created what Jharkhandis called the G5 — a group of five Independents, or single MLAs from small parties, without whom the government could not function. They were Madhu Koda (Independent) Kamlesh Singh, Bandhu Tirkey, Enos Ekka and Sudesh Mahto.

Most of these MLAs are involved in pending criminal cases. Take Kamlesh Singh. He is the son of a judicial officer with fairly humble beginnings. But two years ago, when his daughter got married, five chartered planes landed in Ranchi with relatives and friends, not just from India but also abroad. Ranchi had never seen anything like that.
When Madhu Koda became chief minister backed by the UPA in 2006, his first statements were: he would undo the last few decisions taken by the previous government and would look afresh at the 40-odd memoranda of understanding signed by the previous government — sending shivers down the spines of steel tycoons, including LN Mittal.

Today, inquiries into Koda’s affairs indicate not just a huge international empire of assets but a list of leaders he had business dealings with. At least one of them is a former minister from Bihar and another a sitting cabinet minister from Maharashtra.

Heat on Koda to come clean

A public interest litigation filed in the Jharkhand High Court about a year ago by a resident of Ranchi, Durga Oraon, had facilitated the Enforcement Directorate (ED) to unearth the documents relating to alleged purchase of a coalmine in Liberia, hotel in Mumbai and Thailand, properties and companies across India and involvement in illegal foreign exchange transactions worth around Rs 2,500 crore by the former Chief Minister of Jharkhand Madhu Koda along with his associates.

The Jharkhand High Court on Thursday directed the Income Tax Department to furnish a detailed progress report of its investigation into the assets acquired by Madhu Koda, his five former ministerial colleagues and his two business associates by November 12, the next date of hearing. While Madhu Koda is currently undergoing treatment in a private nursing home in Ranchi after the I-T raids, his two business associates, Binod Sinha and Sanjay Choudhary and others were asked by the I-T department to appear personally to explain certain transactions and events relating to the seizure of huge documents by them.

The appearance of Koda’s associates before the Additional Director, IT (investigation), Ranchi had been fixed on Friday, but only one of Koda’s personal assistants and another person had appeared before the IT officials.
It may be mentioned that after the high court’s orders on the PIL, the I-T sleuths had started the probe into the assets disproportionate to the known sources of income of Koda, businessmen Sinha and Chaudhary and former ministers of Jharkhand, Kamalesh Singh, Bhanu Pratap Sahi, Bandhu Tirkey, Harinarayan Rai, Enos Ekka and Chandra Prakash Chaudhary.

The state Vigilance Department and the Enforcement Directorate had instituted separate FIRs against former ministers Harinarayan Rai and Enos Ekka for amassing assets much in excess to their known sources of income.
The state Vigilance Department after completing the investigation, submitted a chargesheet. The Directorate of Enforcement is also probing case under the Prevention of Money Laundering Act.

Source: Business Standard