Monday, October 17, 2011

Boeing USA- Air India Scam


Boeing USA- Air India Scam

A scam where alleged kickbacks were payed by Boeing USA for the Air India deal worth 230 USD  million. The kickbacks were routed through Hasan Ali Khan, the notorious benami for many politicians in India.

People involved

§  Jagdish Tytler, then Civil Aviation minister
§  Hasan Ali Khan
§  Kashinath Tapuriah

Corporates

§  Boeing Commercial Airplane Co
§  Air India
§  RM Investments & Trading Co, a firm owned by Tapuriah

Scam

Hasan Ali Khan, said to be the country's biggest tax evader, had made a killing as a consultant when he had earned a commission of US $ 11.5 million for a Boeing deal with Air India in 1986-87. At the exchange rate then, the amount works out to over Rs 14 crore.
This startling information is part of a 2007 Enforcement Directorate (ED) Case Information Report filed as an annexure in the 1000-plus-page charge sheet filed recently by the ED in a special court under the Prevention of Money-Laundering Act against Khan and his associate Kashinath Tapuriah.
The civil aviation minister at that time was Jagdish Tytler. The report says that as consultants of Boeing Commercial Airplane Co, Seattle, USA, an amount of US $ 11.5 million was earned as commission from the sale of two Boeing 727 aircraft to Air India in 1986-87. The deal was worth US $ 230 million.
The charge sheet mentions that the amount was not repatriated to India by RM Investments & Trading Co, a firm owned by Tapuriah. The charge sheet, however, does not specify who among the accused earned the commission.
There are clear-cut indications of corruption money involved in mega transactional deals representing commissions (which appear to be illegal) received on sale of Boeing Aircrafts held by Air India. It involves loss to the exchequer, the ED has said.
The transactions, according to the ED, are part of a series of transactions that involve several violations of the Indian Banking Law as well as an effort to manipulate the business contacts with criminal intent of stashing unaccounted assets in Switzerland, a tax haven.
The ED also stated that from the report received from the additional director of income-tax, Mumbai, it was clear that returns of income or returns of net wealth were not filed by Hasan Ali Khan, his wife Rheema Khan, Faizal Abbas, and their involvement in more than $ 8 billion of laundered money was clear; the money was supposed to be stashed away in UBS, Zurich, as confirmed by the confirmation letter dated December 12, 2006, permitting withdrawal of $ 6 billion.
The report also points out at a sudden increase in Khan's bank deposits in 2006. "The increase in bank deposits maintained in UBS Bank, Zurich, from US$6.62 billion as on August 31, 2006 to US$8 billion as on December 8, 2006 is showing an exceptionally high increase of more than $1.38 billion in less than four months, the report said.
The ED further alleged that Khan had purchased several high-value properties in cash and suspected them to be the proceeds of crime. This includes flats in affluent parts of Mumbai and Pune and a property at Akbar Manzil, Hyderabad, and a hotel Chateau Gutsch in Switzerland purchased for approximately $ 25 million in 2001. Others of Khans cash purchases include a fleet of cars, including two Mercedes and a Porsche, and 15-20 horses valued at several lakhs of rupees. The report also lists a huge amount cash and jewellery worth crores that were recovered during income-tax department searches.
Hasan Ali Khan was the person who has strong links with Sonia Gandhi through Ahmed Patel (Sonia’s Political Advisor). So the investigations are slow. Hasan Ali Khan controls Sonia’s illegal money and invest it different foreign Banks.

Investigation

No specific investigation was launched into the kickback and the conspiracy involved. Infact the scam came to light only when the Supreme court compelled Enforcement Directorate to go after Hasan Ali Khan.

Prosecution             :           Nil

Conviction               :           Nil

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