Telgi moved to more complex counterfeiting when he began to counterfeit stamp paper.

He appointed 300 people as agents who sold the fakes to bulk purchasers, including banks, insurance companies, and sharebroking firms. The size of the scam was estimated to be more than 20,000 crore (US$3.8 billion) One aspect of the scandal that caused much concern was that it required the involvement of many police officers and other government employees. For example, one Assistant Police Investigator was found to have a net worth of over 100 crore (US$19 million), despite making a salary of only 9,000 (US$171) per month. On 17 January 2006 Telgi and several associates were sentenced to ten years' rigorous imprisonment. On 28 June 2007 Telgi was sentenced to rigorous imprisonment for 13 years for another aspect of the scandal. He was also fined a Rs 100 crore. The Income Tax Department requested that Telgi's property be confiscated to pay the fine.

 The stamp paper scam has the Mumbai police running for cover. A native of Belgaum in Karnataka, Abdul Karim Telgi, is suspected to be the kingpin of the racket, which involved printing and circulating duplicate stamps and stamp papers. Senior policemen and politicians are suspected to have helped him expand his multi-crore business.

 Abdul Karim Ladsaab Telgi, in his early forties, is keeping the police force of at least 19 states on tenterhooks. He began as a vendor in a small railway station before coming to Mumbai. Though Telgi's business empire was controlled from Mumbai, the Maharashtra government never showed much enthusiasm to expose or end the racket.Noted social reformer Anna Hazare filed a PIL in the Bombay high court to force the state government to act.

 Two MLAs - Anil Gote (Dhule, Maharashtra) and Krishna Yadav (Himayat Nagar, Andhra Pradesh) - have been arrested and charged under the Maharashtra Control of Organised Crime Act. Apparently Gote, helped Telgi get a stamp vendor's licence using a recommendation from former Maharashtra chief minister Vilasrao Deshmukh. Yadav, it is believed, demanded Rs 2 crore to protect his illegal business.

 Today, the investigation is out of the hands of the state government and is monitored by the court. Some believe that to be reason for the arrest of some very high profile people.

 On the court's orders, retired additional DGP Sukhwinder Singh Puri was appointed head of the Special Investigation Team probing the racket as its then chief, DIG Subodh Jaiswal, was junior to cops who were under scrutiny. Known as 'Justice Puri' in police circles, Puri enjoys the reputation of being an upright officer. It was after he entered the picture that the accused began emerging from the shadows. He has shunned the media glare and steadfastly stuck to his work.

 Former Mumbai police commissioner R S Sharma is the highest ranking officer to be arrested so far. Even at the time of his appointment, Sharma was plagued with allegations of bribing his way to the top post. Retired ACP M C Mulani reportedly demanded a bribe from Telgi. Despite knowing this, Sharma let him continue in the team investigating the scam. IGP Sridhar Vagal is the second highest ranking officer to be arrested. Among other things, he reportedly allowed Telgi a free rein even when he was in police custody. At that time, Vagal was working under Sharma in Mumbai.

Anil Gote

Krishna Yadav

Vilasrao deshmukh

R S Sharma

Subodh Jaiswal