Ankita Desai.: 16-F-222 Saurabh Deshpande.: 16-F-223 Sanchita Kadam.: 16-F-239 Jay Mandavkar.: 16-F-252 Priyanka Mudbidri.: 16-F-260 Introduction • Abdul Karim Telgi- the lead role of the fake stamp paper scam • Scam exposed links with various politician and top officials • One of the biggest scam India has ever faced • Telgi’s network spread across 13 states involving 176 offices, 1000 employees and 123 bank accounts in 74 cities Early Life • Born – 1961 • Schooling – Sarvodaya Vidyalaya • Graduation (B.com) – Belgaum college • He moved to Saudi Arabia, came to Mumbai after seven years (1980s) • Worked as a travel agent • Later he worked in Colaba guest house. What is the Scam • Telgi Scam – Valued at 32000 cr • Two Aspects – Creation of Counterfeit Documents and Creating scarcity of original documents • He started with fake passport , stamps then stamp papers • Bribed Indian security press to obtained govt printing machine • Main Buyers were RBI, Government, Insurance company, BSE • He had over 350 employees under him • To create a scarcity- Original Documents were Dispatched to address which didn’t exist Key People Involved • Anil Gote (MLA Dhule, Maharashtra) helped Telgi to procure the Stamp Vendor license. • Former A.P. minister C.B.K. Yadav demanded Rs 2 crore to protect Telgi’s illegal business. • As per SIT, Former Mumbai Police Commissioner R.S. Sharma, did not maintain absolute integrity in the investigation into the scam. • Former Joint Commissioner of Police, Crime Branch, Mumbai, S.S. Vaghal, allowed Telgi a free rein even when he was in police custody. What did the Scam Operation involve? • Stamp Paper • Judicial Court Fee Stamp • Non-Judicial Stamp • Revenue Stamp • Special Adhesive Stamp • Foreign Bills • Broker Notes • Insurance Policies • Share Transfer Certificates • Insurance Agency Stamp How did the scam came to light? • It was the arrest of two men who were transporting fake stamp papers on 19th August 2000 in Bengaluru on a police tip-off. During their interrogation these men spilled beans about a network supplying these fake documents, resulting in raids across country. • During these raids police recovered fake stamp papers & other legal documents worth over nine crore rupees. • In this investigation Abdul Karim Telgi’s name emerged, but back in 2000 he was one of the absconding suspects. • It was only after the arrest of Telgi in November 2001, the magnitude of scam was revealed. Method followed by Telgi • His agents would first talk to the henchmen of politicians. • As the next step he would build a chain of ‘reliable contacts’ through the first contact and deals were struck in his presence. • Telgi would then offer them a State wide contract. • Telgi floated several companies, including a film distribution agency to facilitate his activity. • He recruited unemployed youth to sell counterfeit stamps at 2 per cent discount. Chit companies, along with courts and real estate agencies, were his prime targets. Numerical Figures • The Special Investigating Team (SIT) of the Maharashtra Police put the total value of the scam at Rs.21,28,47,07,824.
• Later this was revised to Rs.32,000 crores by the Union
Home Secretary.
Seized fake stamps, valued at Rs.170 crores, displayed in
Bangalore. Numerical figures • EX-Finance Minister Jaswant Singh was Speaking in the Lok Sabha on a calling attention motion on the stamp paper scam, the minister said the agencies had registered 74 cases in this connection, with 15 against chief accused Abdul Karim Telgi.
• Special Investigation Team (SIT) first taken the case
during 1995-2003 and then hands over stamp scam cases to Central Bureau of Investigation (CBI) on April 13, 2004 Court’s Verdict • On 17 January 2006, Telgi and several associates were sentenced to ten years rigorous imprisonment. • On June 28, 2007 Telgi was sentenced to rigorous imprisonment for 13 years. • Fined a whopping Rs. 202 crore on various counts in one of the main cases of the scandal. • Honorable Judge Chitra Bedi sentenced 42 other accused in the case, who too had pleaded guilty, to rigorous imprisonment for up to six years and imposed fines on them. Impact Of Telgi • Public sector bank became more responsible • Government verified the stock of Stamp Papers with Authorized vendors. • Bank managers ensured that further transactions are proper. • Public/People suffered the most as legal cases were delayed due to declaration of stamp papers as fake papers
(Issues in Business Ethics 8) Peter Ulrich (Auth.), Peter Ulrich, Charles Sarasin (Eds.)-Facing Public Interest_ the Ethical Challenge to Business Policy and Corporate Communications-Springer Netherla(1)