India is known around the world for its consistently heavy demand for gold in myriad forms—jewelry, bullion, and even trinkets or religious offerings. An enormous amount of the public’s wealth is held in the form of gold in India due to a lack of banking services for rural citizens, in fact.
Now, however, an apparent weakness in cash transport protocols has been uncovered after a series of attempted robberies have occurred this summer.
Reserve Bank of India, State Bank of India Both Hit
A week ago, a small container transport vehicle carrying 20 lakh (200,000) rupees worth of coins (roughly $30,000) was discovered to be operated by an intoxicated driver who was not accompanied by his delivery escort. The coins were being transferred between and delivered to banks. (The added security is dropped when the amount of cash drops below a certain threshold covered by insurance.)
You can’t blame the authorities for assuming the worst, however. In mid-May, under the guise of a similar transfer of cash as part of official bank business, 570 crore rupees (5.7 billion rupees, or over $85 million) were seized from travelers caught trying to steal the money. This was followed by a train heist on August 9th, where criminals attempted to pilfer 340 crore rupees (3.4 billion rupees, almost $51 million). They were found out when someone noticed that boxes filled with cash being transported on the train had been tampered with.
On August 9, in a daring heist in a moving train, Rs five crore out of Rs 340 crore cash being sent to RBI here from Salem in Tamil Nadu was found stolen. The incident came to light when four of the 226 boxes stacked with the cash were found tampered with on arrival of the train in Chennai. In the latter case, the cash was supposedly destined for the Reserve Bank of India (RBI), while the former robbery was en route to the State Bank of India.
Cash robberies evoke images of train hijacking, bank heists, and violent threats. Yet, this string of incidents in India seems more similar to the white-collar crimes of hacking bank accounts or money laundering.
More so than recovering stolen cash, Indian authorities are frequently occupied with catching gold smugglers. Due to government restrictions on gold imports and gold ownership that are meant to curb the country’s ballooning trade deficit, many people resort to smuggling gold into India to satisfy demand. Interestingly, South Africa, which has been one of the world’s top gold producers for over a century, faces similar problems with gold smuggling and theft. In both countries, the criminal activity is very likely tied to money laundering operations.
Essentially, it’s safe to assume that any place where there’s a large amount of gold or money moving around, there is going to be a higher incidence of security breaches of this kind.
The opinions and forecasts herein are provided solely for informational purposes, and should not be used or construed as an offer, solicitation, or recommendation to buy or sell any product.