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ED to ask NIA for information on Zakir Naik’s finances

The agency plans to scrutinise the IRF’s papers to check if the discrepenices amount to a case of violation under the Foreign Contribution (Regulation) Act.

Written by Rashmi Rajput | Mumbai |
December 17, 2016 1:51:26 am
Zakir Naik, Zakir Naik ngo, Zakir Naik ngo funds, ngo funds, foreign funds ngo, Islamic Research Foundation, IRF, terrorism, india news Controversial Islamic preacher Zakir Naik. (File)

The Enforcement Directorate (ED) plans to write to the National Investigation Agency (NIA) for information on the financial transactions of Zakir Naik’s Islamic Research Foundation (IRF). The ED wants to check for financial irregularities in the funds received by the banned NGO, which is being probed by the NIA for charges of radicalisation.

WATCH VIDEO | Controversial Islamic Preacher Zakir Naik Likely To Be Quizzed By NIA

“We have learnt that the probe conducted by the Economic Offences Wing (EOW) of the Mumbai Police found certain unexplained financial transactions and even some shell companies floated by IRF founder Zakir Naik. The IRF also received donations from foreign contributors, and therefore we want to probe if there have been any irregularities in these funds,” said an ED official.

The agency plans to scrutinise the IRF’s papers to check if the discrepenices amount to a case of violation under the Foreign Contribution (Regulation) Act or if shell companies were floated to launder money.

“Our probe will first dwell on the point whether it (the discrepancies) is a FCRA violation or a case under PMLA. Once that is decided, we will chart our future course of action,” added the official. ED sources said floating of shell companies and diverting funds to accounts held by ‘relatives’ are regular modus operandi employed in money laundering cases.

“The EOW probe indicates that Naik transferred money received by the IRF to the accounts held by his relatives and also rerouted the money through some companies. These ‘layerings’ are a regular ploy used by offenders to launder money,” said the official. “Only after we study the case papers would we be able to ascertain the trail of the money and the purpose for floating these companies,” he added.

Meanwhile, sources claimed the initial probe by the NIA against Naik, the controversial televangelist, has revealed financial irregularities.

“Around 65-70 per cent of the IRF’s donors are domestic, of which most were by people who have visited the NGO or the programmes organised by them and made ‘small contributions’ of less than Rs 10,000. These contributors are difficult to track,” said an official.

“While the funds released by the IRF towards donations or scholarships are shown as ‘expenses’, the same also acted as a source of income for the Islamic International School (IIS), an affiliate of the IRF, which are not properly reflected in the account books,” added the official.

During the course of the preliminary enquiry (PE) conducted by the EOW, deposits ranging between Rs 50 crore and Rs 60 crore from the Gulf countries into the account of a relative of Naik had come under the scanner of the Mumbai Police. According to police sources, the funds were transferred to accounts operated by Naik’s wife, children and other relatives.

According to the records available with the Registrar of Companies (RoC), besides his NGO IRF, Naik had set up two real estate companies and a video and television software production house, Harmony Media, in Mumbai between 2005 and 2008. Naik and his wife, Farhat Zakir Naik, were promoters-cum-directors of the two real estate companies – Longlast Construction and Right Property Solutions – till March 2013. Both these companies did not report any income in the seven-year period between 2009 and 2015.

Harmony Media was incorporated in 2005. Zakir Naik was the managing director from May 8, 2006 till he resigned on March 13, 2013. His wife was appointed on the board on May 8, 2006, and resigned on March 15, 2013. In the last couple of years, while Longlast Construction saw a surge in borrowing, Harmony TV saw a steady growth in revenue.

Naik has been booked under Sections 10 (Penalty for being member of an unlawful association),13 (Punishment for unlawful activities) ,18 (Punishment for conspiracy) of the Unlawful Activities Prevention Act (UAPA) and Section 153A (promoting enmity) of the Indian Penal Code (IPC).


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