Dozens of Venezuelans protested on Friday in several states over their lack of ability to swap 100-bolivar bills that have been taken out of circulation amid sky-high inflation, with reports of looting at some commercial establishments. "Attempted looting in some parts of the country. A situation aggravated by the lack of cash. The new bills aren't appearing," EFE news quoted the President of Venezuela's opposition-led National Assembly, Henry Ramos Allup, as saying on Twitter. The Mayor of the southeastern municipality of Sifontes, Bolivar state, reported road closures, attempts to loot stores and angry protests in that region and uploaded photos on Twitter that showed dozens of people lining up outside state-owned banks to swap their money for new higher-denomination bills and coins. "Looting in the municipality of El Callao (Bolivar state); the people demand an extension of the time to deposit the discontinued bill," Carlos Chancellor, a member of the opposition MUD alliance, wrote. The Governor of the north-central state of Miranda, prominent opposition leader and two-time presidential candidate Henrique Capriles, also urged citizens to demand that the Tuesday deadline for swapping the 100-bolivar note be extended. The Venezuelan Central Bank on Thursday took the 100-bolivar note, the largest denomination bill, out of circulation, while citizens have between Wednesday and Friday to deposit those notes at public or private banks. Those unable to deposit all of their 100-bolivar notes at bank branches will still have until December 20 to declare and deposit those bills at the Central Bank. The government had announced that a new family of higher-denomination bills better suited to the country's high inflation rate, which hit 180.9 per cent at the end of 2015, would begin to circulate on Thursday. With citizens still waiting for these bills, leftist President Nicolas Maduro said on Thursday night that they were now being distributed at bank branches. --IANS lok/ ( 321 Words) 2016-12-17-02:32:13 (IANS)</s>Brand New Bank Notes Are Already Being Used For Corruption

On Nov. 8 – the same day American politics was upended – India’s prime minister announced the sudden invalidation of all high denomination currency notes, accounting for a whopping 86 percent of the country’s cash. Demonetization, as it is referred to here, has thrown Indians rich and poor into a protracted state of confusion and frustration.

The move’s primary intention has been to catch tax evaders. A significant portion of India’s cash is ill-gotten or undeclared, and it passes hands in an extensive shadow economy that goes untaxed.

 Invalidating 500 and 1,000 rupee notes meant that all Indians, including those hoarding large amounts of cash, would have to exchange those notes for new ones at a bank. In the process, official thinking went, all cash would become accounted for, and those who had been evading taxes would either have to stomach huge losses or declare their assets and pay major penalties.

For the plan to work, however, it had to be done in secret. Otherwise, those in possession of India’s “black money” could have converted it into noncash assets such as gold and avoided detection. That secrecy meant that the minting of new notes – new 500s, and 2,000s instead of 1,000s – could not happen in earnest until well after the invalidation was announced, lest a whiff of the change seep out. At current rates of printing, analysts say it may take three more months, if not double that, to restore the economy to its previous level of liquidity.

As such, India is now in the throes of a major cash shortage. Banks have each set their own limits on ATM withdrawals, leading to long lines as people’s cash runs out quickly. People are spending hours in those lines, often to find out that cash has run out before their turn. That’s not to mention entire sectors of the economy – including segments of agriculture and even manufacturing – that are entirely cash-driven and have gone through major slowdowns because of the shortage.

For the first few weeks of demonetization, it was common to meet Indians who felt that their collective suffering and inconvenience was justified because it would ultimately usher in a less corrupt, more equal India. But as the initiative enters its second month, more and more reports are emerging of seizures of vast quantities of hoarded cash in the new notes. Like water reaching the sea, the corrupt, it seems, have found ways to navigate around the government’s new obstacles.

In just two states alone, India’s Income Tax department said on Dec. 14 that it had recovered 202,200,000 rupees (roughly $3 million) in new 2,000 notes, according to ANI News. In those two states, Karnataka and Goa, the department said it had registered a total of 36 cases and recovered unaccounted-for assets –mostly in cash, jewelry and gold – in excess of 10 billion rupees (roughly $150 million).

Stories of humongous seizures of assets including new currency have become so common that news outlets are simply adding them as bullet points to stories with running tallies. A sense is building that while millions of Indians languish in ATM lines, the old black money system is simply restarting itself with the new notes.</s>New Delhi: Finance Ministry today exuded confidence that supply of new currency notes will considerably improve in next 2-3 weeks even as it asked the RBI and banks to "countercheck" the data regarding deposit of now-defunct currency notes to ensure there is no double counting.

The RBI has already pumped in Rs 5 lakh crore worth 500 and 2,000 rupee notes and by month end about 50 per cent of the Rs 15 lakh crore worth demonetised currency would be injected into the system, Economic Affairs Secretary Shaktikanta Das told reporters here.

"Finance Ministry, RBI and enforcement agencies are working in tandem so that situation eases out. Situation has considerably improved. And going forward, I would expect in next 2-3 weeks situation will considerably ease out with the supply of more new 500 rupee notes," he said, adding that condition would not "worsen" after December 30.

He said the government has stepped up printing of 500 rupee notes and as its circulation increases, people would also take out the 2,000 rupee notes they were hoarding so far.

More than 2 lakh ATMs have already been recalibrated against 2.20 lakh ATMs and it has come to the Ministry's notice that some banks in order to ensure that they are in a position to service their own customers, they prefer to give the cash through their branches.

"We have advised banks that they should continue replenish cash in ATMs and not to starve ATMs. We are monitoring it regularly," Das said.

As per RBI data, over Rs 12.44 lakh crore worth defunct 500 and 1000 rupee notes have been deposited till December 10. "RBI has given a figure of Rs 12.5 lakh crore which has been received back. There are lot of areas where we feel there could be double counting. So we have identified those areas and we have requested RBI and banks to again double check.

"So a process of correction, checking, counter checking of the figure, due diligence is being done to see there is no double counting of figure.... We think there is scope for double counting and therefore the scope for verification of those figures are going on," Das said.

He said three times the total number of lower denomination notes -- 100, 50, 20 and 10 -- which RBI supplies in a year has been supplied over the last five weeks. About Rs 1.60 lakh crore worth 100 rupee notes were in circulation before November 8 and more than Rs 80,000 crore worth of this notes have been supplied to the market over past five weeks.

The DEA Secretary further said that more number of 50, 20 and 10 rupee notes has also been circulated in the system. "Roughly about almost 50 per cent of the notes which were in circulation would be supplied in the next 10-15 days," Das said, adding seized notes are being put back to circulation as soon as possible.

Prime Minister Narendra Modi had on November 8 announced scrapping of old Rs 500 and Rs 1,000 notes, and replaced by new Rs 2,000 and Rs 500 notes. The demonetised notes accounted for 86 per cent of currency in circulation or Rs 15.4 lakh crore.

"More and more production lines have been diverted in printing 500 rupee notes because we have enough number of 2000 rupee notes that have been supplied and there is enough stock available. But now the printing of the 500 rupee notes have been significantly stepped up.

"It has been pushed into the market so that the supply of 2000 rupee notes becomes more mobile. So with increased supply of 500 rupee notes, the 2000 rupee notes which people were hoarding till now will come back to the system," Das said, adding notes are being airlifted to areas facing shortage.

He further said that the security features and design of the new notes were indigenously developed and hence the possibility of counterfeiting it is far far lower. Das also promised to sort out issues faced by Nepal and Bhutan due to non-availability of 500 and 2,000 rupee notes.

"As far as Nepal is concerned we have already examined the report, so we will be taking some action, whatever action govt will take is under examination. As far as Bhutan is concerned, the RBI has made necessary arrangements for supply of cash required by Bhutan authorities because Indian rupee is accepted in Bhutan.

So the RBI has given necessary instructions to connected banks to give necessary cash required by Royal Monetary Authority of Bhutan," he said. Das said the RBI has a particular plan of action with regard to currency supply.

"With regard to remonetisation process, it would be as per requirement and also government has given a big push to digital transaction. There is very significant growth of digital transaction and therefore the requirement of cash will be measured and based on requirement the cash will be remonetised."

He said the CBDT is taking "surgical action" on data provided by the Financial Intelligence Unit (FIU) and the Suspicious Transaction Reports (STRs) filed by banks for detecting illegal accumulation of new currency.

"Further action is being taken by the tax department and it is not an aimless fishing expedition," Das said.

With regard to the impact of demonetisation on rabi sowing, Das said the total sowing area so far is almost at par with last year and whatever shortfall has happened will be made good in the coming weeks.</s>The cash flow situation is improving across the country, Department of Economic Affairs Secretary Shaktikanta Das said on Thursday.

Rs. 2,000 notes were printed initially to replace more amount of old notes, but now the focus has shifted to printing more Rs. 500 notes, he said.

"There is an emphasis on providing cash to rural areas from where reports of inadequate availability of cash are coming in," he said.

Following reports of illegal money being seized from across the country, he said, "The notes seized from illegal accumulations are being put back into the circulation as soon as possible."

''The various wings of the government, the RBI and Banks are working to ensure that the situation eases out'', Mr. Das said. "It is the first time, new currency notes have indigenous design, including security features."</s>The Reserve Bank today said it will shortly issue Rs 500 notes in Mahatma Gandhi (New) series with the inset letter E in both the number panels.



 The notes will have Swachh Bharat logo printed on the reverse of the banknote.



 "Some of the captioned banknotes will have an additional character * (star) in the number panel in the space between the prefix and the number," RBI said.



 Packets containing these notes will have 100 pieces as usual but not in serial order. To facilitate easy identification of note packets containing 'star' notes, the bands on such packets will clearly indicate the presence of these notes in the packet.



 'Star' banknotes in Rs 500 denomination are being issued for the first time. 'Star' banknotes in the denomination of Rs 10, 20, 50 and 100 are already in circulation.



 In a serially numbered packet, banknotes with any defect, detected at the printing stage, are replaced at the note printing presses by banknotes having the same number so that the sequence of the packet is maintained.



 As part of its efforts to benchmark procedures against international best practices as also for cost effectiveness at printing presses, RBI had adopted 'star' series numbering system for replacement of the defectively printed banknotes.



 Meanwhile, the RBI said foreign citizens will be allowed to exchange foreign exchange for Indian currency notes up to a limit of Rs 5,000 per week till December 31.



 Earlier, the facility was available till December 15, 2016.</s>CARACAS, Venezuela — Venezuela became a country mostly without cash on Friday, sparking scattered protests and looting around the country as people fumed at having their already limited purchasing power cut off almost entirely.

As the nation's most widely used banknote went out of circulation, the higher-denomination bills that were supposed to replace the 100-bolivar note had not yet arrived at banks or ATMs. That forced people to rely on credit cards and bank transfers or to try to make purchases with bundles of hard-to-find smaller bills often worth less than a penny each.

Indignation at having to deal with an economy even more paralyzed than usual sparked social unrest. Police put down looting near a bank building in the large western city of Maracaibo with several arrests. Young men marched down the street after growing tired of waiting outside the bank to turn in their money. They waved their 100-bolivar bills in the air and chanted "they're useless," then turned and ran as police in full riot gear began firing tear gas canisters.

Mobs looted several businesses in the remote eastern state of Bolivar. In total, authorities said there were protests and looting in six cities, leading to 32 people being detained and one injured.

In Caracas, some people passed the day banging on pots and cursing the government's apparent lack of planning. There was no cash to be seen changing hands on the street or inside shops, and no sign that the new bills were on their way.

President Nicolas Maduro made a surprise announcement Sunday that the 100-bolivar note would go out of circulation by the week's end amid the world's highest inflation. He also temporarily closed the border with Colombia and Brazil, and then on Thursday night extended the border closure for another 72 hours.

Maduro said the closure was needed to thwart "mafias" who hoard bolivars. Critics mocked the notion that gangsters would choose to keep their wealth in the world's fastest-devaluing currency. The 100-bolivar bill — until now the country's largest denomination — is worth little more than 2 cents, down from 10 cents at the start of the year.

The embattled president held up a new 500-bolivar bill on his television show Thursday, promising the new banknotes would soon be in wide circulation and offering to temporarily cut sales tax for credit card transactions. But on Friday, ATMs were still issuing only the now-worthless 100-bolivar notes.

Maduro also said the government has begun to circulate new 100- 50- and 10-bolivar coins, but few seem to have reached the public.

On Friday, Maduro said the ploy to undermine the criminals had worked.

"We've burned the mafia's hands," he said. "That there were some difficulties, and that there may be some difficulties going forward was inevitable."

Venezuelans waited in lines hundreds of people long all week to deposit their cash. On Thursday, shopkeepers put up signs saying 100-bolivar bills would no longer be accepted. That meant many people looking to buy groceries or take taxis were out of luck, as banks had run out of lower-denomination bills like 50- and 20-bolivar notes during the week, and had not yet received the higher-denomination replacements.

Amid the currency chaos, the U.S. cautioned citizens against visiting the economically spiraling South American country.

"Political rallies and demonstrations occur with little notice, and are expected to occur with greater frequency in the coming months," the State Department said in a travel warning. "If security climate worsens, US citizens should note they're responsible for arranging their own travel out of Venezuela."

But there was little sign of political activity of any kind Friday, as people scrambled to figure out how to exchange bolivars for goods and services in an economy essentially operating without paper money.</s>Australia looks set to follow in the footsteps of Venezuela and India by abolishing the country’s highest-denomination banknote in a bid to crack down on the “black economy”.

Speaking to ABC radio on Wednesday, Revenue and Financial Services Minister Kelly O’Dwyer flagged a review of the $100 note and cash payments over certain limits as the government looks to recoup billions in unpaid tax.

Monday’s midyear budget update will include the appointment of former KPMG global chairman Michael Andrew to oversee a black economy taskforce. The black economy accounts for 1.5 per cent of GDP, given many cash payments are untaxed.

Ms O’Dwyer told the ABC not only is the lost revenue owed to the Australian people for schools and hospitals, but it’s also critical for those who do the right thing and pay tax.

“The whole point of this crackdown on the black economy is to make sure we close down any potential loopholes,” she said. Despite the broad use of electronic forms of payment, Ms O’Dwyer warned there are three times as many $100 notes in circulation than $5 notes.

“It does beg the question, ‘Why?’” she said.

There are currently 300 million $100 notes in circulation, and 92 per cent of all currency by value is in $50 and $100 notes.

The minister would not rule out the removal of the $100 note, saying it was up to the expert panel to provide recommendations. “There’s nothing wrong with cash per se, the issue is when people don’t declare it and when they don’t pay tax on it,” she said.

The taskforce will draw on the experience of countries like France, where the government banned cash payments of more than 1000 euros. “I’m not going to put a limit on what the taskforce will look at,” Ms O’Dwyer said.

Liberal Democratic Senator David Leyonhjelm hit out at the proposal, saying “the only people who are distressed by the cash economy are the government and the public servants who want to spend taxes”.

“The incentives for a cash economy would be a lot reduced if taxes were a lot lower,” he told news.com.au. “It’s a reaction to the level of taxes we pay.”

Mr Leyonhjelm said Australia was joining a global push to make it harder to engage in the cash economy. “Whether it will succeed or not is a moot point. Carrying two $50 notes instead of a $100 note doesn’t seem to be much of a disincentive,” he said.

“But with my libertarian hat on, I think the solution is to lower taxes so the incentives to avoid paying taxes are lower.”

It comes after a report by UBS recommended Australia scrap the $100 note. According to UBS, benefits may include “reduced crime (difficult to monetise), increased tax revenue (fewer cash transactions) and reduced welfare fraud (claiming welfare while earning or hoarding cash)”.

“From the banks’ perspective there would likely be a spike in deposits — if all the $100 notes were deposited into banks (ignoring hoarded $50 notes), household deposits would rise around four per cent,” the report said.

“This would likely fill the banks’ Net Stable Funding Ratio (NSFR) gap and reduce reliance on offshore funding.”

India last month demonetised the country’s two highest-denomination banknotes in a bid to crack down on “black money”, sparking chaotic scenes.

Prime Minister Narendra Modi sent shockwaves through the country by announcing on November 8 all 500 rupee ($10) and 1000 rupee ($20) notes — some 85 per cent of all bills in circulation — would cease to be legal tender within hours.

In a scathing editorial in The Hindu newspaper, former Indian Prime Minister Manmohan Singh said the decision had “shattered the faith and confidence that hundreds of millions of Indians” had placed in their government.

“The vast majority of Indians earn in cash, transact in cash and save in cash, all legitimately,” he wrote. “Their daily subsistence depends on their cash being accepted as a medium of valid currency.

“They save their money in cash which, as it grows, is stored in denominations of 500 rupee and 1000 rupee notes. To tarnish these as ‘black money’ and throw the lives of these hundreds of millions of poor people in disarray is a mammoth tragedy.

“It is the fundamental duty of a democratically elected government in any sovereign nation to protect the rights and livelihood of its citizens. The recent decision by the Prime Minister is a travesty of this fundamental duty.”

This week, Venezuela joined suit, with Venezuelans rushing to trade in their 100-bolivar bills after President Nicolas Maduro said he was eliminating the nation’s highest currency denomination in an attempt to fight speculation and currency hoarding.

Earlier this year, Prime Minister Malcolm Turnbull said he was open to scrapping the 5c coin, after Treasurer Scott Morrison was grilled by news.com.au’s Malcolm Farr.
Protests, with looting, erupt in several Venezuelan states as citizens lack cash for gas, groceries, and Christmas gifts, since the highly used, but now worthless, 100-bolívar notes were removed from circulation, and the substitute 500-bolívar notes are not available because of delays in bank deliveries.