Every newsworthy scam employs devices to make large amounts of money in an unscrupulous manner - and the Telgi scam had all the suspense and drama that a scandal needed to thrive and be busted. The district of Khanapur in Belgaum, Karnataka, a small rustic township on the Belgaum-Panaji National Highway, NH 4A, probably would have never been in the spotlight but for its most infamous townsman, Abdul Karim Ladsaab Telgi. Telgi, a former travel agent, was accused of creating and running a multi-crore empire of printing and selling fake stamp paper. At the time when the incident came to light, the illicit business was operational in at least 18 states, employing 400 agents and was worth a starting figure of up to Rs 30,000 Crores. This entire operation was exposed in 2001 and a lot of big names from the Indian political class, bureaucracy, and police were also accused of being involved in the same. Although Telgi was later arrested and convicted for the scam, questions regarding the involvement of other powerful players and entities remain unanswered till today.
Was it possible for a small town B.Com graduate to build a well-oiled crime syndicate without the knowledge of top bureaucrats and policymakers? How many officials were involved in the dissemination of these stamp papers? How was such a massive operation kept under wraps for over 10 years? Were all the fake stamp papers seized after Telgi was convicted and sentenced to jail?
Let us dive into the details of how this simple man from Khanapur built an empire that shook the whole country just as vigorously as the Harshad Mehta scam, 8 years earlier.
Telgi's mother was Shariefabee Ladsaab Telgi, and his father was an employee of Indian Railways. His father died while he was young. Telgi paid for his education at Sarvodaya Vidyalaya Khanapur, an English medium school, by selling fruit and vegetables on trains. He then proceeded to complete his B.Com from Belgaum college. The whole town was happy when Telgi returned as a commerce graduate, but he soon left and took up his first job as a sales executive at Fillix India Ltd in Mumbai. He was given the pink slip from his job because of his ineptitude but soon landed a job as a manager at Kishan Guest House in Colaba.
In the ’80s there was a Gulf stint that prevailed amongst the Muslim populace and Telgi followed suit and landed a job in Saudi Arabia with the dream of making good money. His lazy attitude towards his job cost him dearly once again and he returned to Mumbai seven years later. He started making connections in the underworld and was looking for ways to make quick money. It was while he was working for a fraudulent manpower consultancy firm that he was arrested and jailed for the first time in 1991. While in prison, he met Ratan Soni, a person who was serving a sentence for forgery. When Telgi asked Soni why he had been arrested, Soni told him, “Paisa Chapne ke liye pakda hai aur agar crime karna hai toh chillar paise ke liye nahi karna, bade rupaiye ke liye karna”. Now Telgi was no longer interested in climbing the success ladder he wanted the elevator directly. It was this friendship between Telgi and Soni that gave birth to the idea of forging stamp papers and selling them. They realized that there was less government regulation and focus on the printing of stamp paper and that there was a lot of scope in this business.
He allegedly bribed his way out of prison before completing his sentence and began to build his stamp paper empire.
Unfolding of the scam
After being released from prison, he acquired a stamp paper license in 1994 and opened an office at Mint Road in Mumbai. He began to build his business by making several friends and connections in the stamp office, revenue ministry, and the Nasik Security Press (NSP) where the stamp papers are printed. He used his political clout and bribed people who worked in the NSP. There was an auction scheduled for the selling of special printing machines(used to print various types of stamp paper) which had supposedly become obsolete. These machines are meant to be destroyed and sold but as the auction was rigged in his favour he managed to buy these machines and ensured that the machines weren't destroyed. The Maharashtra police did everything they could to keep this under wraps despite clear evidence of their complicity. Not only did he acquire the presses but also allegedly obtained the original dye for printing and the speciality paper affixed with security marks from the NSP officials.
Thereafter with the aid of his partners in crime and retired NSP officials, Telgi started to use his equipment in four of his printing facilities to print fake revenue stamps, notarial stamps, stamp papers, etc. These were then circulated across the whole country through his network of agents and sold fake stamp papers worth Rs 50,000 per day. Big companies like Indian Oil or the LIC kept buying stamp papers form these agents as they offered them a discount of up to 5% which is a substantial amount given that most vendors give discounts up to 2.5% and the quality of the stamp papers was as good as original so no one could find anything fishy. He also managed to engineer a market shortage of government printed stamp paper by having them sent to non-existent addresses with the help of his friends at the NSP. At the height of its operations, the use of fake stamp papers had become so ubiquitous that in many localities the number of fake papers was far more than the ones printed officially by the government.
How did this saga come to light?
On 19th August 2000, the Bengaluru police received a tip that fake stamp papers were being transported. Two men were transporting the stamp papers and were arrested by the police soon after. What surprised the police was how indistinguishable the fake papers were to the original, leading them to conclude that they had just caught people involved in a very sophisticated and efficient syndicate. After interrogating those two men, they revealed Tegli was one of the kingpins of this business. This led to further investigation and soon snowballed into one of India's biggest scams. Telgi was soon arrested and after his narco-test, he spilt the beans about the huge nexus which involved political godfathers, police officers, and the senior-level bureaucrats.
The aftermath of the scandal blowing up was different parties coming up with stories to cover their tracks in helping Telgi run this racket. A special team was formed (StampIT) to investigate the Telgi Scam which was led by Sri Kumar. Allegations surfaced that even after he was jailed he continued to run the fake printing business using mobile phones. It seemed that he was aware his calls were being traced and so he would keep changing his mobile phone to evade the government. Later the case was transferred to CBI and in 2007, Telgi was sentenced to 30 years to imprisonment and was slapped with a fine of Rs 202 crore. His term was later shortened to thirteen years. Telgi died 10 years after he was convicted due to Multiple organ dysfunction in Victoria Hospital, Bengaluru.
The Indian economy was badly affected by the Telgi scam. Many states, especially in southern India had been adversely affected due to the huge loss of revenues. Over 10 years, the counterfeit stamp paper scam has dealt the Indian economy a shattering Rs 32,000-crore blow. Apprehensions are that it could be much higher.
It's best to follow what Mr Anup Soni rightly says, Savdhan Rahe, Satark Rahe!