ED launches probe into Andhra liquor scam

Hyderabad: In a significant development, the Enforcement Directorate (ED) has initiated an investigation under the Prevention of Money Laundering Act (PMLA), 2002 into the alleged Andhra Pradesh liquor scam. The ED's Hyderabad office recently requested comprehensive information from the Andhra Pradesh Criminal Investigation Department (CID) related to the case.

The ED letter seen by DH has sought details of all identified bank accounts and properties, information on arrested suspects, remand reports filed before competent courts, copies of any chargesheet filed, and any other documentation relevant to the investigation.

A Special Investigation Team (SIT) appointed by the TDP-led NDA government in Andhra Pradesh to probe the alleged liquor scam during the previous YSRCP administration has traced a money trail of kickbacks involving a sitting Lok Sabha member and a former Rajya Sabha member from the YSRCP, according to two sources with direct knowledge of the SIT findings. The investigation also revealed how cash was handled and moved. Notably, between 2019 and 2024, only cash transactions were permitted in liquor shops, with digital payments explicitly prohibited.

The CID's SIT has already made several arrests, while some accused have approached relevant courts seeking anticipatory bail. Their pleas were rejected by the judiciary.

Highly placed sources in the Andhra government told DH that the SIT recorded statements from liquor manufacturers under Section 164 of the CrPC, establishing evidence of a scam estimated at Rs 4,000 crore. Following these findings, as reported in these columns last month, the ED's investigation will focus on potential money laundering of kickback proceeds.

Most manufacturers reportedly confirmed that between Rs 150 to Rs 200 was extorted per case of liquor, amounting to approximately Rs 80 crore in kickbacks monthly. Investigators discovered that the scam was strategically planned around YS Jagan Mohan Reddy's 2019 election promise of imposing prohibition.

Under this pretext, private liquor stores were abolished, and only government-owned stores were permitted to sell liquor in the state. By bringing the entire liquor retail business under government control, the then political leadership allegedly orchestrated the systematic kickback scheme.

The money trail was reportedly routed through the former Managing Director of the AP State Brewery Corporation and an advisor to the then chief minister.

Former Rajya Sabha member V. Vijaysai Reddy, who recently quit the YSRCP, had publicly alleged that Raj Kasireddy, the then IT advisor to YS Jagan Mohan Reddy, was behind the liquor scam.

The TDP government constituted an SIT on November 6 to investigate allegations of irregularities and corruption in the Andhra Pradesh State Beverages Corporation Limited (APSBCL) during the YSRCP tenure. This SIT investigation was followed by a CID probe into alleged irregularities in the APSBCL during the YSRCP regime.