RBI favours ED probe into US-based financial institution DE Shaw deals

NEW DELHI: The Reserve Bank of India has suggest ED that the Enforcement Directorate looks into the allegations of dubious funds routed by US-based financial institution DE Shaw into various entities in India. ED is responsible for investigation into cases of foreign exchange violations and money laundering . 

RBI has further complained to the government that a letter supposedly sent by the Commerce Ministry's Department of Industrial Policy and Promotion, or DIPP, requesting enquiry into allegations against DE Shaw was forged and asked the finance ministry to investigate the same. 

"The banking regulator has clarified that it does not maintain minute details of foreign investments in the country as the onus is on the Indian company (which seeks FDI) to comply with the FDI policy," said a senior official with the finance ministry. 

The RBI has said that it maintains the foreign direct investment data for post-investment reporting for balance of payment (BoP) statistics and it has only basic details of non-resident investors, mainly the know-your-customer (KYC) details and overseas bank account particulars. The finance ministry official clarified that the government has not ordered any investigation into investments made by DE Shaw in India. 

"We are looking into the matter and will soon take a decision," he said, adding that in a particular investment the matter is already pending in the Delhi high court. The Delhi High Court has issued notices to the global investment firm in May this year in the ongoing case between DE Shaw Group and the Hindi print media company Amar Ujala Publications. 

The court had also sought clarifications from RBI, the government's foreign investment clearance body FIPB and Ministry of Corporate Affairs to explain their stand on the Rs 117 crore deal in 2007 where DE Shaw had acquired 18% stake in the Amar Ujala Publications. 

The court asked DE Shaw to file its reply within two weeks and asked RBI, FIPB and others to submit their replies by July 14, the next date of hearing.

OIL FUTURES: Crude Falls As Concerns Over China, EU Weigh

LONDON (Dow Jones)--Crude futures fell more than $1.00 Monday as signs the global economic recovery may be stalling fuelled concerns over oil demand.

Oil prices extended losses made on Friday after data released by China Sunday showed oil imports to China, the world's largest energy consumer, fell to their lowest level in eight months in June and concerns over euro-zone contagion dented risk appetite.

At 1034 GMT, the front-month August Brent contract on London's ICE futures exchange was down $1.26, or 1.1%, at $117.07 a barrel.

The front-month August contract on the New York Mercantile Exchange ...

13 confirmed dead, scores remain missing after cruise boat sinks in Russia

Rescue boats try to locate passengers of a tourist boat that sunk on the Volga River, in central Russia. A passenger boat, believed to have 208 people onboard, sank on the Volga River in central Russia killing at least one 13 people and leaving more than 100 missing, officials said. Regional emergencies ministry spokesman Marat Rakhmatullin said the boat sank in the middle of the river in the Tatarstan region, about 450 miles (750 kilometers) east of Moscow. He said a woman drowned and her body was delivered to a hospital.

GLOBAL MARKETS: European Stocks Drop; Italy In Focus

- European stocks fall on fears that debt contagion may spread to Italy

- Investors dump equities, in particular banks, and favor bonds

- Euro falls against the dollar as debt worries escalate

- Attention on the EU group meeting in Brussels

By Michele Maatouk & Ishaq Siddiqi

Of DOW JONES NEWSWIRES

LONDON (Dow Jones)--European stock markets fell Monday, along with the euro, with investors worried that Italy may be the next domino to fall as the euro-zone debt crisis continues to unfold. As a result, investors flocked to the dollar and core European government bonds.