JOIN USThe Enforcement Directorate (ED) has arrested eight people in connection with the recent seizure of a huge stack of Rs 2,000 notes from two senior engineers.
Those arrested are G Prashanth, brother-in-law of S C Jayachandra, Chief Project Officer of State Highway Development Project. Jayachandra was arrested by the ED officials on December 5. Based on his information, officials arrested seven others involved in exchange of demonetised currency with the new Rs 2,000 and Rs 500 notes.
Sources said Prashanth was instrumental in supplying of new currency. ED officials recovered Rs 91.94 lakh with Rs 2,000 currency from the possession of Jayachandra. “The accused had organised a systematic network for supplying new notes in exchange of demonetised currency to various persons. The exchange was being done for 20-35% commission. The other accused had supplied new notes on earlier occasions to Jayachandra through Prashanth,” an official said.
According to ED officials, the accused used various methods to exchange the banned notes. Several bank account holders used to withdraw Rs 24,000 in new notes, a limit fixed by the Reserve Bank of India (RBI). The accused used to get the exchange done through middlemen. The process would continue using such account holders, the official said.
The other method was through micro-finance institutions. The collection agents of such financial institutions would collect new notes from self-help groups but deposited only old notes in the bank accounts, since they enjoyed RBI exemption. The current account withdrawal limit of Rs 50,000 was also misused to swap demonetised currency.
Cashier arrested
The CBI on Thursday arrested Parashiva Murthy, head cashier of SBM, Kollegal branch, for allowing exchange of demonetised currency in violation of the RBI rules.