ED Attaches Rs10.98 Crore Assets in Karuvannur Cooperative Bank Fraud Case
Moneylife Digital Team 22 January 2025
The Kochi zonal office of the directorate of enforcement (ED) has provisionally attached assets worth Rs10.98 crore under the Prevention of Money Laundering Act (PMLA) as part of its ongoing investigation into the Karuvannur Service Cooperative Bank fraud case.
 
The attached assets include one movable property and 24 immovable properties comprising land and buildings in Kerala. The immovable properties are valued at Rs10.48 crore, while the attached cash deposit amounts to Rs50.53 lakh, the agency says.
 
ED initiated its investigation based on a first information reports (FIRs) registered by Kerala police under Section 420 of the Indian Penal Code (IPC). Over 16 FIRs related to the bank fraud have been filed by the crime branch in Thrissur district in Kerala.
 
According to the ED, since 2010, loans were fraudulently sanctioned and disbursed to individuals and their benamis without any collateral. This was part of a systematic conspiracy orchestrated by the bank's secretary and committee members, in collusion with the manager.
 
The investigation revealed that bogus loans were repeatedly issued against the same properties without the knowledge of the society members. "Benami loans were granted to non-members using inflated property valuations in other members’ names, and the funds were subsequently siphoned off and laundered by the beneficiaries," ED says.
 
According to the agency, the fraudulent loan disbursements were allegedly influenced by members of the CPI (M) district committee, who controlled the governing body of Karuvannur Service Cooperative Bank and received donations from the beneficiaries.
 
A 2021 audit by the registrar of cooperative societies in Thiruvananthapuram uncovered a diversion of more than Rs150 crore. Following the findings, ED conducted extensive searches at 20 locations and five surveys at cooperative banks in Thrissur between August and September 2023.
 
Four individuals—P Sathishkumar, Kiran PP, Aravindakshan PR, and Jilse CK—were arrested in September 2023 under the PMLA for benefiting from the illegally sanctioned loans.
 
Previously, ED attached properties worth Rs117.83 crore belonging to Bijoy and others involved in the fraud. With the latest action, the total proceeds of crime (POC) attached in this case now stands at Rs128.72 crore, the agency says.
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