Search for crime syndicate that smuggled gold from UAE to India under way

Investigators in southern Kerala say gangs use dense equipment to conceal Dh7 million worth of gold

Three .9999 fine gold bars, 400 troy ounces or 28 lbs each, with a combined value of more than  USD 2 million, are displayed at the Bureau of Engraving and Printing (BEP) August 27, 2012, in Washington, DC.      AFP PHOTO/Paul J. Richards (Photo by PAUL J. RICHARDS / AFP)

A major investigation is under way in India after customs officials uncovered an attempt to smuggle Dh7 million worth of gold from the UAE to Kerala this week.

Law enforcement agencies have made one arrest in the southern city of Thiruvananthapuram after 30kg of gold was found hidden in aluminium cylindrical locks and placed in a package labelled ‘foodstuff’.

Customs officials in India said the shipment arrived from the Emirates through air cargo and was addressed to the UAE consulate in Thiruvananthapuram.

The UAE embassy in New Delhi, India’s capital, described Sunday's incident as a ‘major crime’ and said the culprits who “sought to tarnish the reputation of the UAE mission in India will not be spared.”

“The authorities in the UAE have launched an investigation to find out who sent the cargo containing gold to the address of the UAE consulate,” the embassy said on Twitter.

“We remain committed to co-operating with Indian authorities in getting to the root of the crime.”

UAE officials said investigating agencies in both countries were working together to track down the crime syndicate responsible.

High taxes in India make smuggling gold from the Middle East a lucrative business.

The goods and services tax on gold in India is 18 per cent meaning the tax savings on this consignment alone would amount to Dh1.25 million.

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The fact that the attempt to smuggle (a) huge quantity of gold was concealed in diplomatic baggage makes the matter extremely serious

Professional gangs in India and the Middle East work with experts to mould gold so it can be concealed inside metal equipment or melted and smuggled inside the bodies of plane passengers.

Pinarayi Vijayan, Kerala chief minister, has written to India’s Prime Minister Narendra Modi requesting federal agencies to conduct a thorough investigation due to the “serious implications” of the crime

“The fact that the attempt to smuggle (a) huge quantity of gold was concealed in diplomatic baggage makes the matter extremely serious,” he wrote.

Kerala customs officials confiscated more than a ton of gold last year in raids at seaports and airports.

Customs commissioner Sumit Kumar told The National about an elaborate system that involved financiers, carriers and complex logistics to transport and disguise the precious metal so it passed scans and metal detectors.

“All such operations are run by syndicates because only they have this kind of money, plus additional packing and storing they must pay the intermediary helping them. For example gold that is brought by human carriers is sold in a paste. They break it up, mix it and then do a rectal concealment,” he said.

“There are organised networks, people who finance this, people who do the logistics, help them get it out, people who transport it and those who take it to the unsuspecting final customer.”

His officers conduct about 700 raids a year with more than 550kg gold uncovered in Kerala state last year.

“People do body concealment or in goods sent on aircraft, concealment in ships in containers,” Mr Kumar said.

“Nobody will get gold in the pure form openly because then it is as good as handing it over to us. All cargo is scanned. So a syndicate uses dense goods to place it into so that during a scan, the image is not something out of ordinary. Even in a physical examination, you may not see it. You need break up the item to find it.”

He said investigations were being conducted with involvement of the UAE.

Officials were checking documents and evidence to trace the consignment.

“We are gathering information and examining the technical evidence to find out other people who can come forward and help us,” he said.

“We need to find out who sent the consignment, who got clearance done, who it was intended for, who purchased and who financed it.”

Acting on a tip-off, customs officers on Sunday seized the box after obtaining clearance from the UAE embassy.

The cylindrical metal lock units were placed inside a carton containing food items, a pair of shoes and speakers.

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Police have arrested Sarith Kumar, a former employee with the UAE consulate in Kerala, and are on the lookout for another accomplice.

There has been an uproar in Kerala with demands from opposition parties for a full investigation.

Two government employees were dismissed including a top aide to the chief minister who hired a woman for an information technology department and was allegedly linked to the smuggling.

Police are on the lookout for the woman who had worked with the consulate for three years.

The maximum prison sentence is seven years, under the Indian Customs Act, for illegally bringing in large quantities of contraband including gold and evading taxes.

Mridul John, a defence lawyer who has previously worked on smuggling cases, said most were from the Middle East.

“The relationship between Kerala and the Gulf is very strong. This is a large amount of gold so it’s the economics that matters,” he said.

“Most people use several means to get gold into the country like inside electronic equipment, in chocolates and other eatables.

“Those are small quantities but [Sunday's bust] is a large amount.

“These people used the connection of working with the consulate even though they were not staffers any more. The case has got so much interest because of the connection with the  UAE consulate and government of Kerala officials.”

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