The ED, which is probing the alleged Valmiki Corporation scam, recently arrested sitting Congress MLA B Nagendra.
Published Jul 18, 2024 | 9:41 AM ⚊ Updated Jul 18, 2024 | 9:41 AM
Enforcement Directorate (ED).
The Enforcement Directorate on Wednesday, 17 July, alleged that a “substantial” amount “misappropriated” from the Karnataka Maharshi Valmiki Scheduled Tribes Development Corporation Limited (KMVSATDC) was used to procure liquor during the recently-concluded Lok Sabha elections, apart from some highly-priced vehicles.
The federal agency, which is probing the alleged Valmiki Corporation scam, recently arrested sitting Congress MLA and former minister B Nagendra. In a statement, the ED alleged that the legislator’s associates were “implicated in fund diversion and cash management.”
Nagendra was arrested in the money-laundering case after the probe agency inspected his properties and that of Congress MLA B Daddal. The former minister, arrested under the Prevention of Money Laundering Act (PMLA), 2002, and is in ED custody till Thursday, 18 July.
The illegal money transfer case came to light after P Chandrashekar — accounts superintendent at the Corporation — died by suicide. In a purported suicide note, he said some officials had pressured him to transfer crores of money to an unofficial account.
Minister for ST Welfare B Nagendra announced his resignation from the Cabinet on 6 June. (South First)
In the six-page suicide note accessed by South First, he had levelled allegations of corruption to the tune of ₹88 crore against the KMVSTDC’s Managing Director, Accountant, and the manager of Union Bank of India’s MG Road branch.
The investigation began after two FIRs were filed by the Karnataka Police and the Central Bureau of Investigation (CBI) following the tragic suicide of Chandrashekhar on 26 May this year.
The death note revealed the unauthorised transfer of ₹187 crore belonging to the Corporation from its bank account, and from that, ₹88.62 crore was illegally moved to various accounts allegedly belonging to “well-known” IT companies and a Hyderabad-based cooperative bank.
Chandrashekhar had named the Corporation’s now suspended Managing Director JG Padmanabha, accounts officer Parashuram G Durugannavar, and Union Bank of India Chief Manager Suchismita Rawal in the note, while also stated that “the minister” had issued oral orders for transferring the funds.
On 19 July, ED conducted extensive search and seizure operations across 23 locations in four states, uncovering significant evidence.
ED’s probe revealed that approximately ₹90 crore were diverted to 18 fake accounts in Andhra Pradesh and Telangana. These funds were then laundered through various fake and shell accounts, with cash and bullion distributed among the accused.
Nagendra resigned following allegations against him. “A substantial amount of funds were utilised to procure a significant quantity of liquor just prior to the general elections. Additionally, high-end vehicles, including a Lamborghini, were purchased using proceeds from the scam,” said the agency.
During searches at the residences of the former minister and MLA Daddal, the ED said it recovered “incriminating” documents linking them to the misappropriated funds used during the recent general elections.
Nagendra’s associates were also implicated in the diversion and management of the illicit funds.
The general elections were held during April-May and the results were declared on 4June. The Congress government constituted a Special Investigation Team (SIT), which has so far arrested 11 people in the case.
(Edited by Neena with inputs from Nolan Pinto and PTI)
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