Dec. 19: Mr X is a chartered accountant with an office in a multi-storey building on Shakespeare Sarani. On the face of it, there is little to set him apart from others in his field except his conspicuous love of wearing gold.

Unofficially, Mr X runs over 600 proprietorship firms - apparently the largest in the city - that on paper have other names as company directors. He operates from his two back offices, including one behind Lalbazar, and has a leading conglomerate in steel and natural resources on his client list.

Sources said his firms multiplied overnight by almost 60 after November 8, bringing him under the glare of central agencies probing money laundering.

Like Mr X, there are at least a dozen chartered accountants in Calcutta who are under the surveillance of central agencies jointly investigating cases of money laundering since the old 1,000 and 500-rupee notes were demonetised last month.

Sources in these agencies said some of these chartered accountants had rotated unaccounted for cash through a chain of "paper companies" on behalf of their clients, making it next to impossible to trace the black money trail.

While Mr X is making and broking shady deals, Mr Y, who owns a penthouse in a Ballygunge highrise, is busy giving instructions for multiple RTGS transactions - from one account to another. He is officially the owner of two companies, including an agro unit, but has also been linked to six shell companies (also called briefcase companies because they exist only in a sheaf of documents that can be packed into a briefcase). He apparently controls several others through a network of employees.

Calcutta has long been known as the capital of jama-kharchi firms used to launder cash and evade tax. The process involves booking fake revenue by either selling goods and services that exist only on paper or through over-invoicing. This way, old notes can be legally made to sit on the balance sheet of a firm. In most cases, the transaction would be backdated to pre-November 8, the day demonetisation of high-value currency was announced.

The next phase would involve showing fake expenses by way of procurement of raw materials, sundry items or payment of salaries. It would be done to companies preferably located in other states so that they come under different income-tax circles.

"The idea is to spread it across the country so that the income-tax officer who is investigating the local company loses track," said a chartered accountant working with an MNC.

He recalled his stint with such a jama-kharchi company at the start of his career. "I wanted to have an experience of how it works. A few months into the job, I realised the peon in the office was more trusted than many others like me. Every evening, he used to leave the office with a bag, which I later learnt was full of cash," he said.

With less than a fortnight left for the conversion of old notes to new, chartered accountants in their cluttered offices in shabby buildings off Lalbazar Street, Metcalfe Street and Weston Street have gone into overdrive to bail out clients. None of these offices have landlines or name plates to maintain anonymity.

Alerts about suspicious transactions over the past month were generated through banks and also detected by the financial intelligence unit, a central agency functioning under the Union finance ministry.

But the fact that most bank accounts linked to shell companies had been opened with fake KYC documents have posed a hurdle for investigators.

"In 90 per cent of the bank accounts where suspicious transactions were reported, the KYC was found to be fake. In a few cases, we found mobile numbers linked to the account that helped us proceed," said an officer of the investigation wing of the IT department.

Larger the number of layers in transactions, lesser the chances of tracing the laundered money, he said.