ED arrests former chairman of Karnataka co-operative bank in Rs 63 crore fraud case
The Enforcement Directorate on Wednesday arrested a former chairman of a Karnataka-based co-operative bank for alleged financial irregularities of about Rs 63 crore at one of its branches.
R M Manjunatha Gowda was taken into custody under the Prevention of Money Laundering Act (PMLA) and produced before a special court in Bengaluru, which sent him to ED custody for 14 days, the federal probe agency said in a statement.
The arrest came a day after the ED carried out raids in Bengaluru and Shivamogga districts of Karnataka in the probe against the financial affairs of the Shimoga District Co-Operative Central Bank, City Branch.
“Large-scale misappropriation of funds took place at the said branch which was orchestrated primarily by the branch manager, B Shobha, on the instructions of Gowda,” the ED alleged.
The two and their legal representatives could not be contacted for comment on the ED’s charges.
According to the chargesheet filed by Lokayukta Police (of Karnataka Police), the ED said, Shobha “in conspiracy” with other co-accused “diverted” Rs 62.77 crore.
The modus operandi involved opening “fraudulent” gold loan accounts without the knowledge of individual account holders and using fabricated documents, the agency said.
The “proceeds of crime” generated by Shobha in conspiracy with other co-accused were “laundered” and handed over to Gowda, it said.
Gowda acquired various movable and immovable properties, the agency said, adding the Lokayukta Police chargesheet recorded that he was in “possession of assets disproportionate to his known sources of income”.
