Hyderabad: The Income Tax department and Visakhapatnam police have busted a massive money laundering scam involving illegal transfer of money abroad to the tune of Rs15 billion (Dh85.7 million). The scamsters very audaciously used the legal banking channels to siphon hundreds of crores of rupees abroad through forged documents. Visakhapatnam police commissioner T Yoganand said that the kingpin behind the scam 24-year-old Vaddi Mahesh was taken into custody and criminal cases were charged against him and eight other people on the charges of cheating, forgery and criminal conspiracy.

Police suspect that the network of sham companies and their bank accounts were used to transfer unaccounted money belonging to others abroad.

Investigations by the IT department revealed that Vaddi Mahesh, son of a stone crusher unit owner of Srikakulam Vaddi Srinivas, set up 12 bogus companies in Visakhapatnam and Kolkatta and opened 30 accounts in various banks.

While huge amounts of money were deposited in the bank accounts purported to be revenue from his companies, the same amount was later transferred to foreign bank accounts in Singapore, Bangkok, Malaysia and Hong Kong. On the whole Rs6.80 billion were deposited in various bank accounts and Rs5.69 billion were transferred to foreign bank accounts.

Vaddi Mahesh claimed that the remittances were made to foreign companies for the purchase of software. “But no software was imported and all the documents had been forged,” the police commissioner said.

Police officials said Vaddi Mahesh and his accomplices had been at it since 2014. Police think that around Rs1,500 billion must have been transferred over the last three years.

After initial investigation by IT department and Enforcement Directorate established the forgery and cheating the Joint Director IT Seshu Bhavannarayana lodged a complaint with Visakhapatnam police and cases were booked

The other accused in the case include Vaddi Srinivas Rao, Achanta Harish, Achanta Rajesh, Prasanta Kumar Roy Burman, Praveen Kumar Jha, Ayush Goel, Vineet Goenka and Vikas Gupta.

Police officials say they were probing the possibility of a nexus between the bank officials and the scamsters.