NEW DELHI — The Finance Ministry violated a vital anti-money laundering rule by allowing anonymous donors to donate expired electoral bonds worth Rs 10 crore to an unidentified political party, or parties, soon after the May 2018 Karnataka state elections resulted in a hung assembly.
The ministry took this decision after the “holders” of these bonds — ie, political parties — asked the State Bank of India (SBI), the bank tasked with stewarding the electoral bond scheme, to accept the expired bonds, documents reviewed by HuffPost India establish.
That these bonds were purchased at all was because Prime Minister Narendra Modi’s Office had—illegally—directed the Finance Ministry to break its own rules around the sale of these secretive electoral bonds by opening a “special” 10-day window for them days before Karnataka went to polls.
The documents, obtained by transparency activist Commodore Lokesh Batra (Retd) under RTI and reviewed by HuffPost India, do not name the donors or the political parties that were allowed to accept this set of expired bonds.
In the politically tumultuous days immediately after the inconclusive election in Karnataka results, PM Modi’s Bharatiya Janata Party (BJP) and opposition leaders accused each other of trying to bribe MLAs to cross party lines.
The acceptance of these expired bonds at such a politically sensitive time, in clear violation of the rules governing electoral bonds, sold in a window illegally opened at the direction of the PMO, on the basis of an arbitrary exception signed off by the Finance Ministry, vividly illustrates why...