Money laundering through stock market is a popular mechanism among the financial criminals. Stock market has always been on the target of the launderers. There are many examples where the operators in Indian stock markets washed their dirty linens in stock markets.
Securities Exchange Board of India announced the names of 331 entities which were referred to the Ministry of the Corporate Affairs by the Indian IRS during the investigations related to the various tax evasion schemes. List of all the 331 companies can be obtained on the website of BSE. But there is a need to go beyond the list of these 331 entities and get into the details of the laundering operations.
Techniques of Laundering
There are many methods of laundering the money through the stock markets. One such method is discussed in the video here.
However, there are some more methods which involve tax evasion. There is a possibility that Securities Exchange Board of India penalized these 331 companies for possible tax evasion schemes through the stock markets.
SEBI Rules Violations
Income Tax Evasion
Once the stock market price starts growing up, pink news papers would rush to cover the news with flashy headlines. Now the investors who generated Rs. 88 as gain on paper will file his tax returns under the shadow of the long term capital gains. Tax evasion through shares is a common mechanism in the financial criminals.Which attracts no or very little taxation in India. This causes damage for the government treasury. Tax evasion through shares is the probable reason why Indian IRS departments went further and co-ordinated their efforts to penalise the companies who
- Indulged into the generation of cash
- Evading the taxes and causing the damage to the treasury
- Indulged into the Insiders trading
Certified Stock Market Forensic Accountant
Certified Stock Market Forensic Accountant is one of the most important program offered by the Indiaforensic Center of Studies. In addition to the other topics it also deals with money laundering in stock market. You can find the details of this program in our certification section.