IPL-AN UNDERWORLD DEN OF BETTING MIGHT?

ANISUDDIN KHAN
(feedback@pgeconomist.com)

Apr
26 - May 2, 2010

Narendra Modi, the chief minister of Indian Gujarat tore to shreds the secular image of Indian republic with his personally orchestrated large scale killing of Muslims in his state.

Another Modi, Lalit not related to the chief minister bitten by greed and fame launched Indian Premier League (IPL) cricket circus which triggered an avalanche of betting and match fixing on sports fields not seen before.

Lalit Modi son of middle class businessman initiated the idea of IPL while sitting on the lawns of Wimbledon on the sidelines of the famous tennis championships some years ago with the International Management Group's senior person Andrew Wildblood who agreed to help BCCI when Lalit Modi casually asked him, could cricket not be run on the football league pattern which is churning money for the organisers and players.

Andrew Wildblood a regular visitor to Pakistan in the past never knew that his idea meant to profit the sport and the organisers would run out of control in India under the supervision of ambitious Lalit Modi who later became Commissioner of the League. Within three years after its launching mind-boggling money flowed into IPL which became glamorous and to some extent immoral when betting of over a trillion of Indian rupee were done.

There were charges that even some of the matches were fixed in IPL-I, and IPL-II played in South Africa known as heaven for betting in sports. This was the country which created an ordinary and simple person like cricketer Hansie Cronje who publicly admitted involved in match fixing because he felt his Christian religion did not permit him to lie.

IPL commissioner Lalit Modi has had a trail of failed ventures and defaults till four years back before the launching of the IPL but has a lifestyle now that includes a private jet, a luxury yacht and a fleet of Mercedes S class and BMW cars all acquired in the last three years.

A confidential and explosive report by the income-tax department that has been in the possession of the government for six months, revealed a number of dubious aspects of functioning of the IPL.

Modi who played ugly role in keeping Pakistanis out of the IPL was allegedly involved in betting and murky deals, according to Indian Income tax department.

Highly-placed sources in the IT department in India recently disclosed Modi has been on the government radar for quite sometime.

The alleged opaqueness with which he conducted the multi-billion dollar cricket tournament and the manner in which he took on home minister P Chidambaram in 2009 seem to have resulted in a detailed enquiry into his activities by the I-T department.

Lalit Modi and his allegedly clandestine handling of the IPL would have been ignored had the IPL Commissioner not shifted IPL II purely a domestic Indian competition to South Africa last year on the argument that the League could not be held safely in India due to general election.

This decision went against Indian Union home minister and cast shadow on Indian administrative ability to provide security to the competition.

Indian government of Congress Party did not take the decision lying down and publicly denounced the decision describing it as kind of "no confidence" on the government.

Even this faux pas would have been ignored had the Indian deputy foreign minister Shashi Tharoor an internationally known respectable person not invoked in the deal of a team franchise in IPL II. When minister for external affairs Shashi Tharoor stepped into IPL's murky quicksand, he dragged the government and the congress party into one of the biggest scandals in recent times.

This proved last straw and suddenly the Income Tax department decided to leak some of the findings to the media. Indian income tax sleuths already after IPL II was shifted to South Africa and prepared the report which painted a startling picture of the alleged activities of the controversial IPL commissioner, ranging from his manipulation of land deals in Rajasthan and the existence of a maze of shell companies and offshore entities used to route payments and equity stakes worth hundreds of crores of rupees. The report also makes the startling allegation that

Modi-through his associates-was 'involved' in 'betting', while "insider information and outcome fixing of IPL matches were hinted at".

In preparing the report, investigators seem to have accessed his email account, confidential conversations on a UK-registered cell phone number and regulatory filings from across the globe, from Mauritius to Ireland to the US. Some other Indian cell phone numbers have also been unearthed which the I-T sleuths claim Modi "keeps changing". The report alleges that Modi is "apparently deeply embroiled in both generation of black money, money laundering, betting in cricket (match fixing of certain IPL matches)". A Pandora's box has been opened and it would indict everyone.

The report refers to one Deepa Raizada as a close associate of Modi "who handles his cross-border transactions and offshore companies". Ms Raizada is CEO of Modi Entertainment Networks and has worked at the firm for nearly 10 years, according to two persons who work at the company.

What will come as most disturbing to cricket fans is that the report suggests pervasive betting and outcome fixing in the IPL. According to the report, Modi himself is involved through Samir Thukral, a Delhi-based personality with an opulent lifestyle despite having no apparent source of income".

Thukral is a permanent fixture at all IPL matches with VIP access, the report says, adding that he "carries out the betting on behalf of Lalit Modi". I-T sleuths are investigating "a lot of matches of IPL, especially involving the three teams in which Modi has an interest".

The report alleges that Modi has silent ownership in three IPL teams-Rajasthan Royals, Kolkata Knight Riders and Kings XI Punjab.

Incidentally, Rajasthan Royals won the first IPL tournament in 2008. The report also says Kolkata Knight Rider's co-owner Jay Mehta, who is married to actor Juhi Chawla, is "partly fronting" for Lalit Modi. Industrialist Jay Mehta denies these allegations.

The report claims that Modi owns a stake in Kings XI Punjab through Akash Arora, owner of Delhi-based BPO Netlink Blue. Arora is a part-owner of the team along with Ness Wadia and Mohit Burman, according to the report. Mohit Burman however, declined to categorically state that 100 per cent of the team's ownership rests solely with himself, actress Preity Zinta, Ness Wadia and Karan Paul.

The tax department also accessed details of a transaction relating to the purchase of a luxury yacht in Malta that is to be delivered in Mumbai or Dubai.

WSG and IMG, two companies that received BCCI contracts, are both old business partners in Modi's own businesses. Modi Entertainment Networks runs Fashion TV in India. IMG did business with Fashion TV for years before it won the contract for managing IPL. IMG, a powerful global firm with interests in sports, media and entertainment, was to get 10 per cent of IPL's revenues as management fee. In July 2008, following murmurs that this was too sweet a deal, BCCI terminated the contract.

The two parties later renegotiated and IMG was back in the game with a substantially reduced fee. According to the report, WSG, which owns IPL's overseas rights, was owed $2.5 million by Modi Entertainment Network from an earlier transaction over which Modi had lost litigation both in India and the UK. The report alleges that by awarding WSG rights at favorable terms, Modi was settling the old dues from his private business.

Netlink Blue, whose owner Akash Arora is a part-owner of Kings XIPunjab, according to the report, is another firm that has received favorable BCCI contracts.

It looks like fears expressed in Indian Parliament by both the ruling and opposition parties that the IPL has become an underworld den of betting might are not baseless.

Investigations show that a whopping Rs3,500 crore has already changed hands while another Rs1,500 crore has been pledged on the remaining matches, as the country's rich and poor stake their money on virtually every odd being offered on the IPL. Sources confirm that Rs1,500 crore has been staked on the two semifinals, the final and the playoff match. Money has been pouring into international betting sites too, with Ladbrokes confirming that 2 million have already been bet in the UK. In India betting circles in Gujarat have been extremely busy. Sources say, of the Rs 3,500 crore, over 50 per cent was pumped in from Saurashtra and Kutch alone.

Cricket is a religion in India while IPL has disgraced this status. BCCI is completely responsible for this whole affair. There is huge difference between business and sports.

Indian finance minister Pranab Mukherjee recently said a thorough probe had been ordered on the source and use of funds by the franchises of Indian Premier League and that no one guilty of wrongdoing will be spared. Indian members of Parliament called for a ban and probe into the funding source of the cash-rich Indian Premier League crickettournament.

Some members of Indian lower house have termed IPL as "gambling" in the name of cricket and alleged that black money stashed in foreign banks was invested in the IPL. India's popular leader Lalu Prasad demanded that "murky IPL business of shame and glamour" be probed to know where the money comes from and where it goes.

The IPL, he alleged, is a gambling and betting business. There are bigwigs involved. The entire network should be probed, Lalu Prasad said. He even went to the extent of demanding the government to take over the Board of Control for Cricket in India (BCCI), a private consortium and the apex governing body for cricket in the country. Profit and loss accounts of the last three years and each of the franchisees will be sought.

The BCCI's total earning from IPL-III is estimated to be around Rs1200 crore with an estimated net profit of about Rs573 crore.

The total expenses of IPL's organisers are pegged at Rs653 crore this year. The department will also be looking at allegations of match-fixing. Modi played a role in fixing of matches and in the auction of players. The department will be looking into the funding of IPL teams from abroad, especially money routed through tax havens such as Mauritius, the British Virgin Islands and Cayman Islands.

A list of alleged investments and properties of Modi in foreign countries, including London and Dubai have been identified and would soon be called for questioning.

Most IPL teams are under the scanner, the report said adding that investments by Modi's relatives are also being looked into. The department has been looking into the funding of the Rajasthan Royals since 2008. One of the investors in the Rajasthan Royals is a relative of Modi's-Suresh Chellaram, who is based in Nigeria. Another relative Gaurav Burman is an investor in the Kings XI Punjab.

Lalit Modi's days as the IPL commissioner appear to be numbered as the BCCI's top brass has more or less made up its mind to remove the high-flying administrator who has triggered a political storm and brought the BCCI under the Income Tax scanner. Never in the history of BCCI has the Income Tax sleuths raided the offices. It has not only tarnished the image of the Board but has also sullied the IPL brand.