The Enforcement Directorate (ED) on Wednesday alleged that a “significant” amount of funds “misappropriated” from the Karnataka Maharshi Valmiki Scheduled Tribes Development Authority was used for procurement of liquor besides expensive vehicles during the recently concluded Lok Sabha elections.
The Federal Investigation Agency, which arrested sitting MP and former state cabinet minister B. Nagendra in the case, recently issued a statement alleging that people linked to him were “involved in misappropriation of funds and cash management”.
Nagendra, a former minister for tribal welfare and sports, was arrested by the education department last week after searches were conducted against him and another MP from Basanagowda Dadar, Raichur rural constituency in Bengaluru.
The former minister will be remanded in ED custody till July 18.
The agency alleged that after investigations, “around Rs 900 crore (from Valmiki funds) was diverted into 18 fake accounts in the states of Andhra Pradesh and Telangana.” The diverted funds were then dispersed into fake and dummy accounts and cash and gold bars were distributed among the accused.
“Following the revelation of the scam, former minister B Nagendra also resigned from his post,” the education ministry said.
He added that “a large amount of money was used to procure large quantities of liquor just before the general elections.”
“Additionally, luxury vehicles, including a Lamborghini, were purchased with the proceeds of the fraud,” the report said.
The general election was held from April to May, and the results were announced on June 4th.
During searches at the premises of Nagendra and Dadar (chairman of the company), the ED found “documentary evidence implicating them in handling funds misappropriated during the recent general elections”.
“Further, associates closely associated with B Nagendra are believed to have been involved in misappropriation of funds and cash management,” the report said.
The department said it had also found “incriminating” evidence at Dadar’s home about handling of these illegal funds. The fraud allegations surfaced after the corporation’s accounts chief, Chandrasekaran, was found dead on May 21. He had written a suicide note alleging illegal transfer of funds from the corporation to several bank accounts. Two officials were subsequently suspended. Minister Nagendra resigned on May 29 under mounting pressure.
The Congress government then set up a Special Investigation Team (SIT) which has so far arrested 11 people in connection with the case.
In his suicide note, Chandrasekaran alleged that Rs 1,870 crore was fraudulently transferred from the bank accounts of state-run companies, while another Rs 886.2 crore was illegally deposited in various accounts of several IT companies and a Hyderabad-based cooperative bank.
While the state government has set up an SIT to investigate the case, India’s Central Bureau of Investigation is also conducting a parallel probe based on a complaint by Union Bank.
The agency questioned Nagendra’s wife Manjula on Wednesday as part of its investigation.
© Indian Express Ltd.
First uploaded: 17 July 2024 21:06 IST
