Rs.94 crore Scam: 15 fake accounts, fake signatures and suicide

The Superintendent of Karnataka Maharishi Valmiki Tribes Development Corporation Limited, P. Chandrashekhar, tragically took his own life, leaving behind a suicide note detailing a massive scam worth Rs 187 crore. In his note, he implicated senior officers of the corporation, a minister, and a bank manager from Union Bank of India, accusing them of pressuring him to transfer the corporation’s funds.

Emergence of a Rs 94 Crore Scam:
In the wake of Chandrashekhar’s suicide, another scam involving Rs 94 crore was uncovered in Karnataka. These funds were intended for the benefit of scheduled tribes but were embezzled from the corporation’s account through the use of forged signatures. The money was then transferred to accounts in Telangana and Andhra Pradesh.

Political Implications:
Notably, these incidents occurred during the Lok Sabha elections, leading to allegations from the opposition that the funds were diverted to other states on the orders of the Congress high command for election purposes. Subsequently, B. Nagendra, the Scheduled Tribes Welfare Minister of the Karnataka government, resigned from his post on June 6. The extent of the scam’s financial impact remains unclear, prompting investigations by both the Special Investigation Team (SIT) and the Central Bureau of Investigation (CBI).

Involvement of Various Parties:
Investigations conducted by Dainik Bhaskar have revealed the involvement of multiple individuals, ranging from bank officials to government clerks, in the scam. Chandrashekhar’s wife, Kavita, shared her husband’s story for the first time, asserting that he had been under immense stress and pressure in the months leading up to his suicide. She demanded justice for her husband and called for the punishment of those who harassed and pressurized him, including high-ranking officials and the minister.

Details of the Scam and Investigation:
The Managing Director of the Corporation, A. Rajasekhar, lodged a complaint on May 29, reporting the illegal transfer of Rs 94 crore from the corporation’s account to various accounts using fake signatures. The corporation promptly informed the Deputy General Manager of Union Bank of India after the Chief Manager failed to provide CCTV footage. Consequently, the police filed a case against certain bank officials, and the state government established an SIT for further investigation. On June 3, the CBI registered a case based on the complaint filed by Union Bank of India’s Deputy General Manager, Mahesha J.

Key Arrests and Financial Transactions:
The FIR named Suchismita Raul, the former regional head of Union Bank of India, MG Road in Bengaluru, along with private individuals and public servants. Investigations uncovered that out of the 15 accounts involved in the illegal fund transfers, nine were opened on March 31, all at Hyderabad’s RBL Bank, under the names of various organizations. The SIT arrested ex-Managing Director JJ Padmanabha, Accounts Officer Parashuram, and First Finance Credit Co-operative Society Limited Chairman Satyanarayan. It is believed that Satyanarayan facilitated the creation of fake bank accounts.

Financial Timeline:
On March 31, the final day of the financial year, Rs 50 crore was transferred from the state treasury to the corporation’s account, resulting in a total fund of Rs 187 crore. During a board meeting held on the same day, it was decided to invest Rs 50 crore in a fixed deposit for one year. In a series of transactions on that day, a loan of Rs 45 crore was obtained using the fixed deposit as collateral. The involvement of both bank officials and corporation personnel contributed to the scam.

Allegations and Political Fallout:
Chandrashekhar’s suicide note provided insight into the scam, highlighting that Rs 87 crore had been transferred to various accounts, including those of prominent IT companies and a cooperative bank in Hyderabad. He detailed the unauthorized transfer of funds from the Vasant Nagar branch of Union Bank of India to the MG Road branch, amounting to Rs 87 crore. The suicide note further mentioned specific transactions, including amounts of Rs 25 crore on March 4, Rs 25 crore on March 6, Rs 44 crore on March 21, Rs 43 crore from the state treasury, and Rs 50 crore on May 21.

The scandal has become a significant political issue in Karnataka, with the Bharatiya Janata Party (BJP) blaming the Congress government for corruption. BJP State President BY Vijayendra emphasized that such a massive corruption scandal could not have occurred without the approval of the Finance Ministry, which was held by Chief Minister Siddaramaiah. Conversely, JDS leader and Union Minister HD Kumaraswamy alleged that the funds had been misused for elections. In response to the escalating controversy, Scheduled Tribes Welfare Minister B. Nagendra resigned, expressing his desire for a fair investigation and stating that remaining in his ministerial position during the probe may hinder the process.