The Enforcement Directorate (ED) logo.
Credit: PTI File Photo
Bengaluru: The Enforcement Directorate (ED) on Monday said that they have provisionally attached properties worth Rs 26.27 crore in connection with the alleged scam in the Karnataka Bhovi Development Corporation (KBDC).
The ED said the properties belonged to B K Nagarajappa, the then General Manager of KBDC, and R Leelavathy and other accused. They were attached under the provisions of the Prevention of Money Laundering Act (PMLA), 2002. The current market value of the attached properties was an estimated Rs 40 crore, it said.
According to the ED, the investigations so far revealed that Nagarajappa and Leelavathy were in cahoots with middlemen and their associates and misappropriated funds from the KBDC by sanctioning loans, subsidies and financial assistance to the bank accounts of over 750 fake beneficiaries.
“Later, the amounts so sanctioned from KBDC were diverted to the bank accounts of various entities viz Adithya Enterprises, Somanatheswara Enterprises, New Dreams Enterprises, Harntiha Creations, Annika Enterprises controlled by B K Nagarajappa and others, which was used in the purchase of properties, making payments to middlemen and further diverted to bank accounts of individuals and various other entities,” the ED said.
“The money misappropriated from KBDC was mainly used to maintain their luxurious lifestyle and to acquire immovable and movable properties in their name, and in the name of their family members,” the central agency added.
ED had previously arrested Nagarajappa and Leelavathy under provisions of the PMLA on April 5 and April 12, respectively. The two are currently under judicial custody, the police said.