Fake currency notes flooding India

Watch out, you may be holding a fake Rs 500 note

TNN 31 July 2009, 01:08am IST

Print

Email

Discuss

Bookmark/Share

Save

Comment

Text Size:

|

Around Rs 1,69,000 crore of fake money is in the system. And it's growing. TOI looks into the growing threat.

* Last month when Maharashtra Crime Branch and Anti-terrorism Squad sleuths caught six persons with counterfeitcurrency worth over Rs 9 lakh, they themselves couldn't make out the difference between the fake and genuine notes. "They have 95% features of genuine notes," says an official. The provisions of the Unlawful Activities Prevention Act (UAPA) have been invoked -- for the first time against fake currency.

* Zahoor Ahmad Mir of Rawalpora, Srinagar, withdrew Rs 2,000 from an ATM. He was told by a shopkeeper after his weekend shopping that the currency was fake. A frantic Zahoor rushed to the bank, the ATM of which had coughed up the 500-rupee notes. "But the bank officials refused to accept it. They suspected I had got the fake note from somewhere else," he says.

The proliferation of fake Rs 500 notes has just got bigger. You never know when you are holding one — or more. Even ATMs are disgorging them, indicating the counterfiets are so good that bankers are failing to detect them. Despite measures taken by RBI, the home ministry and intelligence agencies, the fear of the fake has grown — from Kashmir to Kanyakumari, from Gujarat to Assam.

Officials say there's a high volume of fake notes of Rs 100, Rs 500 and Rs 1,000 in the market, and that they have had limited success so far in controlling their spread. The Naik Committee, set up to assess the menace of fake currency, says counterfeit money in the range of Rs 1,69,000 crore is sloshing around the system. And just a tiny fraction of it has been seized: Rs 63 crore.

Both the government and common people are aware of the problem, but feel ill equipped to deal with it. In Chandigarh, traders, banks employees and petrol pump attendants turn suspicious whenever they get a Rs 500 note. "A petrol station attendant refused to accept the Rs 500 note I gave him and warned me about the glut of fake notes in the market," said Rajinder Singh, a resident of Sector-27. Even in Delhi, shopkeepers take extra time in accepting high denomination notes. They first hold a note against bright light and ensure that a watermark is intact.

Many in Kerala are worried over outsourcing loading of currency in the ATMs to private agencies. "My salary account is with a private bank and I also have a savings account with SBI. Lest I should get a counterfeit note, I have now started transferring money only by cheques," says A K Nair, a government employee.

"The extent of the problem can be gauged from the huge gap between actual seizures and circulation of fake Indian currency notes (FICN). Although several steps have been taken by the finance ministry and RBI, weeding out FICNs may take long," says a senior home ministry official. According to security agencies, Uttar Pradesh, Gujarat, Maharashtra, Andhra Pradesh and Karnataka have reported the maximum seizure of fake notes in recent years. The latest haul in Ghaziabad, Noida and Meerut reveal how organized gangs, said to be funded by Pakistan, have penetrated right up to Delhi's borders.

Shopkeepers' associations in Delhi are actively involved in monitoring the counterfeits, many of which come out of ATMs and banks. Says Sanjeev Mehra, president of Delhi's Khan Market Traders' Association, "Every shopkeeper has been issued a circular listing 10 ways of detecting a fake note. The local bank in the market has an officer posted for this very purpose."

Experienced shop-keepers feel the texture of the note, particularly when it's of a large denomination, and hold it under lights to see the water-mark. However, if this year's three major seizures — amounting to over Rs 35 lakh — in UP and Maharashtra are any indication, it's the quality of FICN that has alarmed the security agencies. The paper, say intelligence sleuths, is almost identical to the original, which makes their identification very tough.

The UP STF suggests most of these notes were printed in the security press at Malir Cantonment in Karachi and three other printing presses in Pakistan. Maharashtra's security agencies, too, believe that the fake notes seized by them were printed in a Pakistan government printing press at Quetta.

Fearful businessmen and shopkeepers are installing machines to check counterfeits. In Kerala, the state-run SUPPLYCO (Kerala State Civil Supplies Corporation Limited) with 12 petrol pumps has issued specific instructions to its outlets to be wary of fake notes.

But there are limitations. For instance, large business outlets that handle heavy transactions can't run a counterfeit check every time it receives cash. "During a hectic day, one can't check every Rs 500 and Rs 1,000 note," says Mujtaba Haaziq, manufacturer of signages in Panaji. "In any case, it's the government's job to tackle the problem," says Barnabe Sapeco, a well-known Panaji restaurateur.

The police say arresting the carriers has not taken them to FICN masterminds. "The carriers are briefed on a need-to-know basis and are not aware of the entire network," said a Maharashtra crime branch official. Intelligence agencies are fairly certain that the brains behind the FICN racket are sitting in Bangladesh and Pakistan. As proof, they cite the seizure of an Indian currency-minting machine in Bangladesh in 2006.

(With inputs from Vishwa Mohan & Richi Verma (Delhi), Mateen Hafiz (Mumbai), Pervez Iqbal Siddiqui (Lucknow), Anantha Krishnan, (Thiruvananthapuram), Anand Bodh (Chandigarh) and Gauree Malkarlekar (Panaji)

SOURCE