Through a provisional order, the Enforcement Directorate (ED) has attached assets worth Rs 255.17 crore in the Sree Kanva Souhardha Co-Operative Credit Limited (SKSCCL) scam.
The probe by the economic intelligence agency found that out of Rs 650 crore collected from 13,000 investors, the cooperative bank had advanced over Rs 400 as loans without any surety to the Kanva group of companies owned by N Nanjundaiah, who's also the founder and common director of the SKSCCL. The ED, which has taken up the case registered at the Basaveshwara Nagar police station against Nanjundaiah and the SKSCCL, arrested him on August 25 and he is presently in judicial custody.
The attached assets include agricultural and non-agricultural lands, buildings and resorts besides movable properties such as bank balance of the Kanva group of companies, Nanjundaiah and members of his family. The accused had acquired more than 160 immovable and movable assets from the money, the ED said in a press release. Some of the properties have already been sold to further the layering of embezzled money, the ED added.
The accused had advanced loans out of deposits, working capital and shares reserves without getting any security or following the rules, the agency said.
Account manipulation
"The accused manipulated SKSCCL accounts and suppressed the actual financial position of the society, which was under loss whereas it was projected as (a) profit. The accused indulged in (the) collection of further deposits and not followed (sic) the due procedure while extending the loans, thereby making recovery close to impossible," the statement said, adding that very low liquidity was maintained in the SKSCCL accounts.
The accused also made dubious entries wherever required in the cloud-based Zenith Software. They edited and submitted a window-dressed report to the authorities.