The Enforcement Directorate has informed that it has filed a prosecution complaint against Amnesty International India and other related entities in a money laundering case. A prosecution complaint filed by the ED is equivalent to a charge sheet filed by police.
ED filed a prosecution complaint under Prevention of Money Laundering Act, 2002 (PMLA) against M/s. Amnesty International India Pvt Ltd (AIIPL), M/s. Indians for Amnesty International Trust (IAIT) and others in a money laundering case of Rs.51.72 Crore.
— ED (@dir_ed) July 9, 2022
The probe by ED against the so-called human rights organisation had started following a case against it was filed by the CBI for violation of FCRA rules. The CBI had booked Amnesty International India Pvt Ltd, Indians for Amnesty International Trust, Amnesty International India Foundation Trust and others under Section 120(B) of the IPC, and Sections 11, 35 & 39 of FCRA (Foreign Contributions Regulatory Act), 2010.
Based on the CBI FIR, the ED had registered a case and initiated a probe under the Prevention of Money Laundering Act, 2002 (PMLA). In the investigation, the ED had found that Amnesty International India Foundation Trust was registered under FCRA to receive foreign funds in 2011-12. But later the registration was revoked following adverse inputs on the organisation. And that is when the organisation started to bypass Indian laws to receive foreign funds without permission.
According to the ED, after the FCRA registration of Amnesty International India Foundation Trust (AIIFT) was terminated, they formed profit making companies to receive foreign funds in the grab of export of services and FDI. The group had formed Amnesty International India Pvt Ltd (AIIPL) and Indians Amnesty International Trust (IAIT) in the year 2013-14 and 2012-13 respectively to escape the FCRA route and received forex in the guise of service export and FDI.
Under this new method of receiving foreign fund even after cancellation of FCRA licence, Amnesty International, U.K. had sent Rs 51.72 Crore to Amnesty International India Pvt in the name of FDI and also as payment for export of services. However, the group could not furnish any documentary evidence for the same.
For the so-called export of services to Amnesty UK, no invoices and copies of agreements between the two parties were submitted to the Authorised Dealer Banks. Similarly, the amount received in the name of FDI was used for the usual activities of Amnesty International, called “civil society work”. Thus, the group had violated norms by mis-utilisation of FDI.
The ED had earlier said, “It is prima facie found that Amnesty International India Pvt Ltd and others have obtained foreign remittances to the tune of Rs 51.72 crore in the guise export of services and the FDI from Amnesty International (UK) whose source is the donations from individual donors.”
ED said that all the Amnesty International entities involved in the transactions acquired proceeds of the crime and layered the same in the form of various movable properties. Earlier the ED had attached movable properties worth Rs 19.56 crore in this regard. The bank accounts of AIIPL and IAIT were also attached by the agency.
In light of these facts, the prosecution complaint has been filed under the Prevention of Money Laundering Act, 2002 against Amnesty International India Pvt Ltd and others in the court of Principal City Civil and Sessions Judge, Bengaluru City, Bengaluru. The PMLA court has taken cognizance of the complaint and summons have been issued to all the accused to appear before the court.
This development comes just a day after ED had imposed a penalty of ₹51.72 crore on Amnesty India International Pvt. Ltd, and a penalty of ₹10 crore on its former CEO Aakar Patel for receiving foreign money bypassing FCRA norms. The agency also issued show-cause notice to them for violation of FEMA norms.
The Enforcement Directorate pointed out that foreign contributions were received as Foreign Direct Investment (FDI) to evade restrictions imposed by the Foreign Contribution Regulation Act (FCRA).
The Enforcement Directorate stated that between November 2013 and June 2018, Amnesty India International received foreign funds under the Head of ‘Business/Management Consultancy’ and ‘Public Relation Services.’ These donations were described as foreign remittances received for export to services to circumvent FCRA guidelines.
ED said that while AIIPL is an umbrella entity under Amnesty International Ltd., UK, which was declared to be set up for the cause of social activities in India, it has been involved in many activities which are not relevant to their declared commercial business, and circumventing model has been applied by them to route the foreign funds in the guise of business activities to escape FCRA scrutiny.
