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Sunday, May 15, 2016

tale of 570 crores currency in 3 containers seized ~ Aravakurichi : cash in transit insurance

Aravakurichi (அரவக்குறிச்சி) is a panchayat town in Karur district of Tamil Nadu, India. Aravakurichi is well known as a major market for Moringa oleifera vegetable (drumstick).  The place is in news as the Election Commission of India late on Saturday decided to defer the polls in the Aravakurichi Assembly constituency, following widespread seizure of cash and complaints of voters being bribed.  In an unrelated incident, EC issued notices to the AIADMK and the DMK, asking them to explain the rationale behind the promises made in their election manifestos and indicate how they would meet the financial outlays (for freebies) by Sunday evening.
The Hindu reported that the total seizure by election expenditure monitoring officials, including those from the Income Tax Department, crossed Rs. 100 crore on Thursday, when  just three days were left before the May 16 Assembly polls. More was to happen on which is post is written.  Indian Express reports that a PMK candidate was booked in Ulundurpet Sunday after he showered currency notes on an election official to protest, what he called, the “inaction” of authorities to check alleged distribution of cash to voters by rival parties in his constituency. The action of  the PMK nominee from Ulundurpet constituency, sparked protest by government officials and police said they have registered a case against the candidate on charges of abusing officials.

Do you remember big burly CBI Inspector – SP Balasubramaniam [yes, the great singer]  tracking down the container load of freshly printed bank notes worth 10 billion ~ that was ‘Thiruda Thiruda’ of Mani Ratnam released in 1993 featuring Prashanth, Anu Agarwal and Heera.  Wads of Indian currency fresh from printing, gets stolen by a gangster – the container itself is moved by henchman – but the access card comes in possession  of a singer.  SPB sets to track down – the pop singer comes across two small time burglars of a village who are already on the run – and Heera is the village girl who flees from home.  In the melee, at one point is container gets covered in haystack, with infights and people trying to cheat other.

This week, closer to the elections,  there were reports buzzing all around that 3 container loads of cash was seized.  The Election Commission on Saturday said Rs 570 crore, seized from three containers in Tamil Nadu two days ahead of assembly polls there, is “prima facie suspect cash” as no agency or organisation came forward to claim it.  Reportedly,  Electoral officials in Tamil Nadu. News reports added that the containers escorted by three cars, did not halt, but officials chased them and stopped them near Chengapalli. A check revealed the amount, kept in many boxes, inside the containers, they said. 

A day later, there are reports that the money belongs to SBI who were transporting to their Office at Vizag. The bank is quoted to have claimed  in a statement that  it was 'erroneous' on the part of the poll commission to seize the cash which was being transferred from its main branch in Coimbatore to another branch in Visakhapatnam. "To address a temporary cash shortage in Andhra Pradesh, the RBI has authorised transfer of Rs 570 crore from our currency chest in Coimbatore main branch to our special currency administration branch in Visakhapatnam," said the SBI statement. "As per RBI instructions, our Coimbatore main branch released the treasure to the authorised SBI personnel, duly escorted by a team of Andhra police. But the convoy carrying the cash was stopped by the EC officials enroute and brought to Tiruppur collectorate for further scrutiny," the statement added.

Officials said that the vehicle numbers did not match the documents which aroused suspicion. However, Chief Electoral Officer Rajesh Lakhoni had said the vehicles were likely be released soon if the paperwork was in order. There have been widespread reports of  abuse of money power in Tamil Nadu, the Election Commission had last month also issued some special instructions to be followed by observers and members of the surveillance teams deployed in the state. The Commission had sought "stepped-up vigil" across Tamil Nadu to detect and intercept cash and other inducements being used to lure voters and ensure that a level-playing field is maintained.

The Bank reportedly claims that the cash was transported to Vizag to address financial need and was as per RBI instruction – it was indeed ordinary for the common man to believe that it could be funds to pay voters illegally.  The timing of such huge transfer was certainly not right and if it was so intended, Bank officials should have taken extra care in keeping proper documents along with the vehicles transporting the cash.  Were they not aware of the documentary requirements or were they not aware of Elections around the corner !  How can someone can be so callous in transporting such huge amounts of cash.

There appears some big  gaps in the episode and explanations offered !!

Insurers have a Policy covering Cash – whilst inside the premises (in safe) and whilst in transit. Most well drawn policies would specify at least one end of coverage – could be from the premises to bank and vice versa; between various premises; from collection centres to premises and various other possible combinations. Besides, there could be singular transaction / movement of huge amount of money. Many a times, banks carry huge amounts of money from their chest to their branches and for replenishing ATMs – and such movements can also be insured.  The Insurance premium would generally be calculated on the value of transactions throughout the year and would have a single carriage limit, mode, manner and some details of armed guards accompanying etc.,

With regards – S. Sampathkumar

15th May 2016.

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