Need ready cash? try 'Plastic hawala'

MiD DAY investigates how retailers are offering cash through bogus credit card bills

It's the festive season. But to enjoy the celebrations to the hilt you need a loaded wallet. No need to worry. If you've got plastic money, there are enterprising individuals who can get you the real thing. The only catch: it's illegal.


Hidden agenda: MiD DAY reporters caught on camera this central Delhi
retailer offering cash against bogus bills. Pics/mid day

A MiD DAY sting operation has revealed a unique case of hawala operations to tackle the liquidity crunch during these times of celebrations. Retailers in the Capital are offering cash through bogus credit card bills. The user gets cash, the trader his percentage and the bank gets its due along with a valid bill. Everyone's happy.

Vicious cycle
The investigation was carried out at the cycle market in Jhandewalan. MiD DAY reporters entered one of the shops, dealing in mobile recharge and laptops, located in the basement of a building. The moment the retailer at the popular Bhatia Mobile Shop realised that the customer wants cash against the credit card, he became cautious and asked for a reference.

Once satisfied the shopkeeper agrees to pay cash. "If you want immediate cash we will be charging a commission of four per cent. However if you are ready to accept cheque, the commission will only be three per cent. There is full security for the cheque," he said with confidence.

Bhatia's son, sitting close to him, eagerly interjected and said, "If you want commission free money, you will have to wait for a week. The amount will be electronically transferred to the account." On asking about the reason behind offering commission free money, he said, "We will rotate cash money twice or thrice through various hands and earn a handsome commission. Later we transfer the money to the respective accounts."

Identity crisis
After striking a deal at four per cent commission and immediate cash from the retailer, one of the reporters offered his credit card. Bhatia's son swiped the card for Rs 10,425, which included a commission of Rs 425 for the retailer.u00a0 The shopkeeper then asked for a photo ID. "It is generally needed for any purchase of above Rs 10,000. However, most of the merchandisers don't ask for it as they offer bills. Since we are not offering any bills we need an identity card," he explained.

Bhatia took an impression of the credit card on a plain paper and got it signed along with the mobile number of the reporter. However, before handing over the Rs 10,000, the shopkeeper had a word of caution for the reporters. "Agar koi bank se phone karta hai toh bol dena ki maine treadmill kharida hai (When you get call from the bank, tell the guy that you have purchased a treadmill)."

Everybody wins
When MiD DAY contacted various banks, none of them were ready to comment on the issue. However an official from a private bank, on the condition of anonymity, said: "Basically there are two types of transactions. First are those where surcharges are levied.

A railway ticket booked through a website or fuel purchased at a petrol pump could be a perfect example of this. It is mandatory to inform about such surcharge to the customers. Other transactions are those made at shops where no surcharges are levied."

"Now in this case, the merchant is asking for a commission for giving cash. This is totally illegal and if we receive any complaint, action could be initiated and extend to terminating relations with such merchants. Since cash is dispensed at the pleasure of the customer, we hardly get any complaints. Merchant can land into trouble only if the customer disputes the transaction," the official added.

Police say as all the people involved gain from the transaction, no cases have been reported so far. "During the festive seasons, these kinds of activities increase manifold as there are a liquidity crunch in the market. The money laundering and hawala racket can also not be ignored.

But since we don't receive any complaints from any of the parties, we can not initiate any action against anyone. But in almost all the cases, bank employees work hand- in-glove with the retailers. They are the ones who provide the shops' details involved in such illegal trade practices. Such things also lead to other types of credit card frauds, said a senior official from Delhi police.