Tainted Money

The money is tainted; it is a drain of wealth from the country, being located in secretive Swiss banks; and the sums involved are large. Not surprisingly, the issue of monies stashed away by India's rich and powerful in numbered accounts in Swiss and similar banks is periodically raised, provokes controversy and then enters a period of hibernation.

This periodic revival is understandable for a number of reasons. Most often the transfer of money to Swiss bank accounts involves a violation of tax, foreign exchange and/or other laws of the country, and therefore is illegal and morally repugnant. To boot, the sums involved are not small. Finally, these reflect surpluses that can be used to finance much needed development initiatives in the country, but are now being kept idle abroad to facilitate illegal accumulation. Their existence is symbolic of an elite that places self before nation. This is even truer in the case of alleged payoffs for award of defence contracts. The moral and nationalistic indignation this generates leads to the correct demands that the violations of law that permit the accumulation of such wealth abroad need to be investigated, the offenders must be prosecuted and the money brought back and directed towards pushing growth and improving welfare. Morality aside, equity demands that the rule of law should prevail for all. Currently, three factors have combined to revive the controversy in India. First, early this year, in a major breakthrough, prosecutors from the Internal Revenue Service investigating violations of tax laws by American citizens, managed to force UBS, Switzerland's largest bank, to reveal the names of 250 nationals who were suspected of evading payment of about $300 million in taxes by using offshore accounts. The bank also agreed to pay the US government a sum of $780 million to settle the issue. (For reading more, click link below)