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The raid took place close on the heels of Hurriyat leader and Jammu and Kashmir Liberation Front chairman Yasin Malik's arrest in Srinagar on Monday.
On Sunday, two persons were held in J&K with $100,000, which was allegedly meant for Malik.
The authorities conducted the raid after Mushtaq Ahmed Dar, one of the persons arrested along with the amount, had made "some revelations", sources said.
Besides Dar, police had arrested Shazia Begum, who was carrying the money, near Kud and registered a case under the Prevention of Terrorism Ordinance and Foreign Exchange Regulation Act.
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