The state Cooperative Department’s plot to ‘settle’ the Rs 125.83 cr scam surrounding Karuvannoor Cooperative Bank by passing the blame to former board members and five employees has been defeated as Enforcement Directorate (ED) carried out raid in former Cooperative Minister A.C. Moideen MLA’s house on August 22. Moideen is a senior CPM leader, party’s former Thrissur district secretary and presently state committee member. Raid commenced by 7am and prolonged until late in the evening. There were raids in the Thrissur residences of Kannur native Velappaya Satheesh and the house of jeweller Anil Sait at Cherppu, Thrissur district, also.
Reports suggest that the bank passbooks of Moideen were not in his house during the raid. He is likely to be asked to clarify the assets and deposits of his close relations.
There are reports that 9 bank members were involved in the chit fund fraud worth Rs 9.23 cr according to the accounts examined until March 31, 2021.,
On August 23, ED froze the bank accounts of Moideen. It looks like a grave indication of what is in store for the former minister. All are due to the crucial statements of the accused. There are reports of the hints given by ED that crucial documents were confiscated during the raid. They will be examined and consequently Moideen and others are likely to be summoned to ED’s office and interrogated.
Karuvannur bank fraud touched the peak when Moideen as the Minister in the first Pinarayi Vijayan Cabinet (2016 to 2021). He was the Cooperative Minister from 2016 – 2018. But, the officers of the cooperative department had reported the fraud details earlier. But, there was no result hence the cooperative registrars submitted reports before the Minister (Moideen) direct. But, allegations came up that Moideen not only did not take action but, tried to hide it. ED examined the documents, in this connection, on July 20, 2021. Then ED officers visited the bank on August 10 and 25, 2022. Afterwards they collected the information and documents, regarding the role of Moideen in the issue.
Former Cooperative registrars, the expelled CPM district committee member C.K. Chandran, and the former bank manager Biju Kareem, Accountant C.K. Jils, father of the former secretary Sunilkumar are the main accused who have reportedly given statements about the role of Moideen in the issue. Bank’s former manager-in-charge M.V. Suresh had been summoned by ED and had reportedly conveyed details of Moideen’s alleged involvement in the issue. When ED reached Moideen’s house, accompanied by police force, he was there. Twelve-member ED team went from Kochi.
On August 23, ED froze Moideen’s bank accounts of Rs 31 lakhs. There are reports that even thoughThese accounts were not revealed by Moideen during the raid. Three benamees (proxies) have been summoned to ED offices in Kochi and interrogated.
There are reports that the repayments of the deposits, in view of the scandal, were executed under political influence. Huge amounts were paid back whereas the small amounts were not.
Case was registered on August 7, 2021 in connection with the Karuvannur Cooperative Bank fraud. Former bank secretary T.R. Sunilkumar, former branch manager Biju Kareem, former senior accountant C.K. Jils, bank member Kiran, former commission agent A.K. Bijoy and accountant Reji Anil of bank’s supermarket are the accused in the case.
E.D. confiscated A.K Bijo’s properties worth Rs 30.70 cr. While raid was going on in Moideen’s house, ED was interrogating the former Karuvannur Bank Extension Branch Manager M.V. Suresh.
During the initial stage of the case, Moideen was not in the scene. ED suspect that during 2011-16 when Moideen was the CPM Thrissur district secretary, he had intervened in sanctioning the bank loans and in the official affairs of the bank. Former Branch Manager Biju Kareem allegedly had phone conversations with Moideen. Moideen’s nominees got crores of rupees as loans. ED suspect, they are benamees (proxies). Raids were conducted in the houses of Anil Subhash, Satheesh and Shiju, Raheem. ED investigation team have reportedly found out that Shiju and Raheem are Moideen’s distant relations. It is reportedly found that Rs 22 to 25 cr had been loaned to the above-mentioned four individuals.
ED have reportedly found that two different minutes were kept for the bank meetings. One minute for keeping along with the official documents. And, the other one was fabricated for inappropriate affairs. ED suspect that politicians’ crores of rupees had been flowed into bank in illicit manner. And, they were loaned to benamees.
Karuvannur fraud has been rated as the largest fraud in the history of Kerala Cooperative history, thanks to the intrinsic value of the Karuvannur bank fraud. ED reportedly rate it as Rs 400 cr. The first enquiry report of the local Kerala Police says, it is Rs 300 cr. The interim report submitted by the Crime Brach on August 13, 2022 said, it was Rs 117 cr. Report submitted by nine member cooperative expert council on August 9, 2021 showed Rs 226.78 cr. Cooperative department’s final study recommended Rs 125.83 as recovery amount.
Crime Branch alleges that five people, including employees and intermediaries, had availed Rs 117 cr as fake loans and those monies were swindled. Fifty eight assets of the five accused have been confiscated as per the order of the Vigilance Court. But, the largest confiscation is the one that is going to be carried out against Sunilkumar. In fact, Crime Branch had given clean chit to the same Sunilkumar. Department has reached a conclusion that Sunil should pay Rs 9.18 cr.
ED went to the houses of jeweler Anil Sait and Satheesh Velapayam to get the details of the large amounts which came to the cooperative bank during the currency devaluation of 2016. ED had got the clue that large-scale deposits came to the bank, including banned currencies, during those days. Bank deposits in 2015 – 16 were Rs 405.51 cr. In 2016 – 17 it increased to Rs 501 cr, that means Rs 96 cr increase in an year. Deposits flowed in just after the devaluation was declared by the Prime Minister. Next year it was decreased to Rs 340 cr. In 2021, the deposit came down to Rs 301 cr. And, the case was regarding the fraud worth Rs 301. Rs 200 cr was withdrawn within five years. ED believes that there were interventions of some well-known people behind the withdrawal of such large sums during such a short period. And, they might have heard about the bank crises. They might have helped their close associates.
Criminal actions are likely to be taken against the chartered accountants who helped the fraudulent activities. Crime Branch investigators had not interrogated them.
Raid in Moideen’s house is a grave blow to CPM. CPM was ruling the bank during the period of bank fraud. Party had tried to save itself by taking actions against some leaders. Bank Board of Directors were expelled en bloc. Senior functionaries of the bank were party men. Sunilkumar, and K.M. Biju Kareem were CPM local committee members, whereas C.K. Jils was a party member. Kiran had got the job due to the party connection. C.K. Chandran who failed to trace the fraud is expelled from the party, he is not taken back yet. Others were taken back, after an year, to the lost positions.
Moideen was the CPM Thrissur district secretary during the days of the fraud. Despite receiving complaints, district leadership did not take any action. Later on a two member party committee found serious malpractices and reported accordingly, but, it was swept under the carpet. Even though senior leaders from the district had complained before the state leadership, nothing happened. Later on Moideen was made a minister. The minister came to Thrissur to inaugurate the supermarkets of Biju, Kareem and Jils while they were the accused in the bank fraud case. This looks like the tip of the ice berg. More frauds likely to come up in the days to come.
BJP and Congress-led Opposition United Democratic Front (UDF) has beefed up their protests against A.C. Moideen. Meanwhile, Moideen said that he is ready to face any sort of inquiry.