Government-owned Bank of Baroda has denied allegations made by CNN IBN-FirstPost that the bank's Nassau branch in the Bahamas has transferred Dawood Ibrahim's funds. Ibrahim, reportedly living in Karachi under the patronage of Pakistan army, was held responsible for the 1993 Mumbai blasts by the Supreme Court. The US has called him a global terrorist.
The lender said its Nassau branch had been maintaining the account of Dubai Exchange for several years. "It is a KYC (know your customer) compliant account where transactions take place in the normal course of business to established banking channels. All AML (anti-money laundering) guidelines are followed. Hence, we deny any involvement of Bank of Baroda in alleged transfer of funds as reported in the Media," the bank's chairman and managing director, S S Mundra, said in a statement.
Earlier, FirstPost and CNN-IBN had reported that Bank of Baroda's Nassau branch saw successive wire transfers of several hundred thousand dollars from at least three Dubai-based currency exchanges-the al-Zarouni Exchange, the Dubai Exchange and the al-Dirham Exchange-suspected to be proceeds from organised crime.
"The account has been operational for more than a decade. Credit to this account comes from the US clearing systems which itself is self explanatory about the due diligence and there has never been an alert (about suspicious transactions) on this account," Mundra told Business Standard.
"We further clarify that Bank of Baroda's Nassau Operations are conducted strictly within the regulatory framework of the host/ home country and are subject to usual systemic controls," the statement said.
Recently, online magazine Cobrapost alleged three Indian private sector lenders-ICICI Bank, Axis Bank and HDFC Bank-for violating money laundering and KYC norms. The media house had conducted sting operations to show how the bank branches are offering to accept black money from their customers to convert them into white.
Following the allegation, the RBI started an investigation into the matter and had asked details from the banks. The three banks had suspended the employees who were allegedly involved in wrong doings. The banks have also conducted forensic enquiry by independent agencies following the allegations.
