Interpol red corner notice against Nirav Modi's brother Nehal
Interpol has issued a Red Corner Notice (RCN) against fugitive diamantaire Nirav Modi's brother Nehal Deepak Modi, a Belgian national, in the Rs 13,500 crore Punjab National Bank fraud case.
 
According to Interpol, the RCN was issued against Nehal Modi on charges of the money laundering. The RCN has been issued against Nehal Modi on the request of the Enforcement Directorate (ED) which is probing the money laundering case against Nirav Modi, who is currently lodged in a London jail, his sister Purvi Modi and his uncle Mehul Choksi of the Geetanjali Group on charges of money laundering.
 
The ED had requested Interpol to issue an RCN against Nehal for his role in helping Nirav Modi launder bank funds. The ED probe has found that Nehal Modi intentionally assisted his brother in concealing the alleged laundering of money and destroying evidence.
 
The ED has registered the case of money laundering on the basis of the CBI FIR filed in February 2017. Nirav Modi and Choksi are being investigated by the ED and the Central Bureau of Investigation after PNB alleged that they cheated the bank of Rs 13,500 crore with the involvement of some bank employees.
 
Nirav Modi and Choksi also face charges under the Fugitive Economic Offenders Act. Both fled India before details of the fraud emerged in January, 2018.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    What Troubles the Bureaucrats?
    I, like many Moneylife readers, love to blame the bureaucrats for the present mess in our country. Moneylife readers will be aware of silly demands made by tax authorities including issuing notice for Rs10 discrepancy.
     
    We have also seen complaints by industry and individuals about the need to improve 'ease' of doing business. But the question is: why is it so complicated? What makes these bureaucrats behave so? Let us first look at some real examples. (Details have been changed to protect the concerned parties.)
     
    Some Real Bureaucratic Experiences
     
    A chief engineer from a top municipal corporation once told me that his desk computer was inoperable for two weeks because the mouse was broken. He explained, if he bought a mouse from the stationery shop close by, it would cost him around Rs400, but he will have to face inquiry about why he did not route it through the procurement portal. He cannot initiate the process through the portal because he did not have a mouse, so he has to make a paper application and that has not been processed as yet. So, he was stuck. And so were all of us!
     
    The head of the department, which deals with Municipal hospitals, was faced with a few problems. First, by law he was required to invite tenders for the critical parts of magnetic resonance imaging (MRI) machine manufactured by a multi-national company (MNC). His argument to the municipal commissioner was that if machine was made by MNC, then how can we procure original equipment manufacturer (OEM) parts from non-MNC party at lower rates? He was asked to invite the tenders. His second problem was the L1 bidder for the critical parts had quoted 1/10th the price MNC had quoted. This made no sense to him. But he was constrained by policy to award the tender to L1 bidder. 
     
    One engineer in charge of road works found himself in unusual situation. He was faced with contempt of the High Court since he was not getting the road repaired, as per the terms of award of contract. His dilemma was complicated. The contractor refused to repair the road because he had paid off the commissioner and the head of the department and his payment was already sanctioned. A creative advocate found a way out for him. The signed approval papers releasing the payment to the contractor were to be sent by municipal corporation’s office courier to head office for preparation and release of cheque. The approval papers were recorded in out-register but thereafter magically disappeared. They reappeared at the head office AFTER the contractor understood and repaired the road. The High Court order was thus complied with. 
     
    What Ails the Bureaucracy?
     
    Bureaucrats are bled into the system by using auditor approach. A bureaucrat who wants to work for the nation-building quickly realises that he is suffocated. The tool—show cause notice. The Indian Administrative Services (IAS) lobby is established such that if you become part of the system, things flow smoothly. Improving the system invites show-cause. Thus, the system incentivises non-corrupt officers to lie low. Such officers enjoy good standing but only if they do not attempt to change the system. 
     
    Bureaucracy thrives on de-attribution. Their tenure is supposed to be limited and jobs transferable. Hence, the work has to have standardised procedures and bureaucrats are plug-and-play employees. Alert citizens may be amused (or horrified) to see the chief secretary of mining become finance secretary or be transferred to health department but that is the design of the system. Therefore, no decision can be traced to a person—only to the chair. 
     
    The system itself, a relic of corrupt times, is designed to create bottlenecks or gates. These bottlenecks serve as rent-seeking opportunities for the gatekeepers. The procedure becomes complicated so that the gatekeeper at the top can seek rent from the gatekeepers lower down. So, what looks like a mess to the citizens, is a masterfully designed rent-seekers' paradise. That is why I think our bureaucrats are quite competent if they apply their minds.
     
    But do they apply their mind? Bureaucrats do not apply their mind; they put their nose to the paper and follow the procedure. Bureaucrats cannot take the goal-oriented approach to their work. Else, they fall out of the system, which means, half-salary and no top-up earnings. Therefore, in many cases High Courts check if the concerned officer has 'applied his mind' to the problem before him. Sadly, High Courts discover it only when they themselves apply their mind.
     
    Dealing with Bureaucracy
     
    Jack Welch has described a great approach to dismantling the bureaucracy within General Electric Co (GE). While, Mr Welch and his management of GE has come under fire recently, we cannot find fault with his dealing with the GE bureaucracy. Mr Welch seized the GE's vast bureaucracy by the scruff of the neck and shook it till it saw stars. Welch focused on two parameters—efficiency in meeting objectives and performance.
     
    If not the radical management style of neutron Jack, as Mr Welch was called, there are other strategies to improve the bureaucratic processes. The principles of total quality management have not reached the bureaucracy. We need to see objective based management of departments, kaizen-based approach to improvement. These ideas are well-understood in corporate world but seem alien to world of government.
     
    Lee Kuan Yew (LKY) fixed the bureaucracy with few simple elements. A vision of service to the country which prime minister (PM) LKY himself lived by, unflinching focus on meritocracy and a fair and just salary structure. Bureaucrats in Singapore are trained in the best universities and exposed to diverse work practices before taking up responsibilities within government. Sir Kenneth Stowe described it as “a good piano playing good music.” Both the objectives, i.e., good music, and the system, good piano, were important to Lee Kuan Yew. The Indian bureaucracy is a decent piano but playing the wrong music.
     
    Unlike popular perception, bureaucrats need to be made directly and personally liable for their performance. This is called attribution. When projects like Konkan Railway and Delhi Metro were handed over to E Sreedharan, when the election commission was handled by TN Seshan, things looked up. 
     
    Attribution makes bureaucrats responsible for their actions. It works in public projects carried out private players as well. In a recent Twitter conversation Sucheta Dalal highlighted the importance of Tanmoy Chakrabarty from TCS for improvement in Passport Services. 
     
    Imagine if we gave recognition to the chief of Hindustan Aeronautics Ltd and put the expectations on him, will we get more Tejas, Sukhois and other aircrafts that function better? I think so.
     
    (Rahul Prakash Deodhar is an advocate, Bombay High Court and a private investor. He can be reached at [email protected], on twitter at @rahuldeodhar or at his website www.rahuldeodhar.com)
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    COMMENTS

    Tarun Singhal

    3 days ago

    interesting analysis. this is choking the growth of 21st century India!

    How the mighty Akasha Syndicate was ensnared by DEA and jailed
    At the very kernel of the Vicky Goswami-Ali Punjani drug bust is the deadly and dangerous Akasha family with strong global links and sinister connections with the underworld and a long history in drug trafficking.
     
    So who are the Akashas? IANS tried to find their background and a lot of it emerged from the US Drug Enforcement Administration (DEA) report filed in the US District Court, Southern District of New York, in the US vs Baktash Akasha Abdalla case. 
     
    Baktash and his brother Faisal have underscored the Akasha name in Kenya by saying -- "Whoever comes and wherever they come from, when they say our name, they know we are drug dealers...meaning we work in drugs." They are the kingpins of what is a global drug cartel. 
     
    In continuum with the DEA probe, in mid August this year, a US judge sentenced a leading Kenyan drug trafficker, Baktash Akasha, to 25 years in prison after he pleaded guilty last year to a conspiracy to import heroin and methamphetamine and other crimes.
     
    US District Judge Victor Marrero in Manhattan sentenced Akasha, 42. Prosecutors described Akasha as the leader of a crime syndicate called the 'Akasha Organisation', a major smuggling operation connecting the poppy fields of Afghanistan to European and US cities. In his guilty plea, Akasha also admitted to bribing officials in Kenya.
     
    His brother, Ibrahim Akasha, has also pleaded guilty in the case and is scheduled to be sentenced by the same judge in November.
     
    Baktash Akasha took control of the organisation after his father, Ibrahim Akasha, was killed in a shooting, according to authorities.
     
    The case stemmed from a US Drug Enforcement Administration probe into the Akasha Organisation, leading to the extradition of the brothers to the US from Kenya in January 2017 along with Gulam Hussein, a Pakistani national charged with heading a drug transportation network, and Vijaygiri 'Vicky' Goswami, an Indian businessman accused of managing the organisation's drug business. 
     
    According to the Superseding Indictment, other court filings, and statements made during court proceedings: 
     
    AKASHA ABDALLA and his brother, Ibrahim Akasha Abdalla, a/k/a "Ibrahim Akasha" (together, "the defendants") operated a sprawling and lucrative international drug-trafficking organisation, which distributed multi-tonne quantities of narcotics, including hashish, ephedrine, methamphetamine and methaqulone -- a Schedule I controlled substance commonly referred to in Europe, South Africa and elsewhere as "Mandrax" or "mandies," and in the US as "Quaaludes." 
     
    For almost two decades, BAKTASH AKASHA ABDALLA acted as the leader of the Akasha Organisation, and Ibrahim Akasha Abdalla functioned as his brother's deputy. The defendants engaged in acts of violence to protect the reputation of the Akasha Organisation and their drug-trafficking business. 
     
    For example, in 2014, the defendants kidnapped and assaulted a rival drug trafficker in Kenya named David Armstrong. The defendants helped orchestrate the murder in South Africa of an associate of Armstrong, who was known as "Pinky" and was shot approximately 32 times in the street. The defendants subsequently participated in an altercation at a public shopping mall in Kenya with an Armstrong associate named Stanley Livondo, during which Ibrahim Akasha Abdalla threatened Livondo with a pistol. 
     
    By early 2014, the defendants and other members of the Akasha Organisation started to work to import huge quantities of methaqualone precursor chemicals into Africa in order to fuel the illicit pills' production in South Africa. 
     
    The defendants used the proceeds of their methaqualone-related business to pursue other illegal ventures, including efforts to import ephedrine that was produced illegally by Avon Lifesciences in India, so that the Akasha Organisation and others could manufacture methamphetamine in Africa. 
     
    In connection with these methamphetamine-production efforts, the defendants aligned the Akasha Organisation and other associates with co-defendant Muhammad Asif Hafeez, a/k/a "Sultan," and worked together to establish a methamphetamine-production facility in Mozambique. 
     
    But the defendants, Hafeez and other co-conspirators, were forced to abandon their plan after the law enforcement authorities seized approximately 18 tonnes of ephedrine from an Avon Lifesciences factory in Solapur, India, including several tonnes of ephedrine that the defendants and Hafeez planned to use to manufacture methamphetamine in Mozambique.
     
    Over the course of several months beginning March 2014, during telephone calls and meetings in Nairobi and Mombasa, Kenya, the defendants agreed to supply, and in fact did supply, multi-kilogram quantities of heroin and methamphetamine to individuals they believed to be representatives of a South American drug-trafficking organisation, but who were in fact confidential sources (the "CSes") working at the direction and under the supervision of the DEA. 
     
    The defendants negotiated on behalf of the Akasha Organisation to procure and distribute hundreds of kilograms of heroin from suppliers in the Afghanistan/Pakistan region and to produce and distribute hundreds of kilograms of methamphetamine, which they understood would ultimately be imported into the US. 
     
    During a meeting in Mombasa in April 2014, BAKTASH AKASHA ABDALLA introduced a confidential source via Skype to one of his heroin suppliers in Pakistan, who said he could provide 420 kg of 100 per cent pure heroin, which he called "diamond" quality, for distribution in the US. 
     
    Thereafter, in June 2014, a co-defendant began discussing with the CSes his ability to procure methamphetamine precursor chemicals and to establish labs to produce methamphetamine for importation to the US. 
     
    In a meeting in Mombasa in September 2014, BAKTASH AKASHA ABDALLA introduced another co-defendant as a narcotics transporter from Afghanistan who moved huge quantities of narcotics using ships. BAKTASH AKASHA ABDALLA and a co-defendant also described Hafeez to the CSes as one of the top drug traffickers in the world. 
     
    In September and October 2014, Ibrahim Akasha Abdalla personally delivered 1 kg samples of methamphetamine and heroin to the CSes in Nairobi on behalf of the Akasha Organisation. 
     
    In early November, Ibrahim Akasha Abdalla personally delivered an additional 98 kg of heroin to the CSes in Nairobi on behalf of the Akasha Organisation. A few days later, Ibrahim Akasha Abdalla also delivered another kg of methamphetamine. In the course of these preliminary transactions, the Akasha Organisation provided a total of 99 kg of heroin and 2 kg of methamphetamine to the CSes, and agreed to provide hundreds of kilograms more of each.
     
    The defendants, along with Gulam Hussein and Vijaygiri Anandgiri Goswami alias Vicky, were provisionally arrested by Kenyan Anti-Narcotics Unit officers on November 9, 2014, in Mombasa, prior to another planned meeting with the CSes. 
     
    At the time of the provisional arrests in Kenya, 500 kg of heroin brokered by Hafeez were being transported through international waters to the defendants in Africa. The defendants directed the ship to return to the Afghanistan/Pakistan region rather than risking interdiction upon arrival. 
     
    Following the arrests and during pending extradition proceedings, the defendants continued to distribute huge quantities of narcotics. They used some of the drug proceeds to bribe Kenyan officials -- including judges, prosecutors and law enforcement officers -- in an effort to avoid extradition to face the charges against them in the US. 
     
    On January 29, 2017, the Kenyan government expelled the defendants, and the DEA brought them to the Southern District of New York for prosecution.
     
    The strong Indian connect comes from Vicky Goswami and Ali Punjwani, both married to Indian actresses Mamta Kulkarni and Kim Sharma (now estranged), respectively. In 2013, Vicky Goswami, after serving a 15-year sentence in Dubai, accepted the Akasha proposal and began to help them distribute the 'abba' (a precursor chemical they would use to manufacture mandrax) that they accessed through their corrupt connections with Kenyan officials and large scale manufacturers of mandrax in South Africa. 
     
    From here the Akashas and Goswami expanded their illegal distribution of abba by seeking out other suppliers. Baktash obtained contact information for an abba supplier in China named Martin Hong. Sometime in June-July 2014, Baktash arranged for Hong to travel from China to Mombasa to meet with the Akashas and Goswami. 
     
    They decided that Hong supply them with abba at $40,000 per tonne, plus an additional $30,000 per tonne if he agreed to an exclusive partnership. After initial hesitation, Hong accepted the offer. 
     
    Over the next three years -- including while the Akashas were bailed pending the US extradition request which they were actively obstructing -- Hong provided the Akasha Organisation 10 tonnes of abba. 
     
    From this point, he was involved virtually in every deal that the Akasha Organisation entered. In 2014 and 2015, the Akashas' primary drug trafficking rival in Mombasa was Ali Punjani. To target Punjani, the Akashas targeted associates like Speedy and Tony Sanhani.
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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