Bengaluru: Former MUDA commissioner arrested by ED for money laundering

Bengaluru: The Enforcement Directorate (ED) has arrested former Mysuru Urban Development Authority (MUDA) commissioner GT Dinesh Kumar on charges of money laundering, agency sources said on Wednesday.

The arrest came after ED officials conducted searches at two residential properties in Bengaluru belonging to Kumar and questioned him.  

The searches were held under the provisions of the Prevention of Money Laundering Act, 2002 In connection with the alleged scam in the allocation of MUDA sites.

Kumar has been remanded in ED custody for nine days.

The sources, however, said Kumar’s arrest wasn’t directly linked to the alleged MUDA scam involving CM Siddaramaiah and his wife, BM Parvathi, but was focused on the overall illegal allotments. 

According to the sources, Kumar, during his tenure as MUDA commissioner (2022-2024), allegedly indulged in large-scale illegal allotment of MUDA sites in lieu of gratification and pecuniary benefits. “The investigation till now has revealed his active involvement in money laundering activities. Further probe is on,” they said.

In June 2025, the ED had attached 92 properties worth an estimated Rs 100 crore in connection with the MUDA ‘scam’. At the time, the agency said its investigation revealed large-scale illegalities in the allotment of sites by violating various statutes and government orders/ guidelines and by other fraudulent means.

“The role of ex-MUDA commissioners, including Dinesh Kumar, has emerged as instrumental in the illegal allotment of compensation sites to ineligible entities/individuals. The evidence with respect to obtaining bribes for making illegal allotments in the form of cash, bank transfer, movable/immovable properties has been gathered during probe,” it had alleged.

The ED had also alleged that the sale profits were routed to Kumar through “loans/advances to his relatives and associates”. “Some of the sites were transferred to relatives/associates of Dinesh Kumar and other influential persons.” 

The central agency initiated an investigation against Kumar based on the FIR registered by the Lokayukta Police in Mysuru last year under various sections of the IPC, 1860 and the Prevention of Corruption Act, 1988, against the CM, his wife and others.

The ED, in its provisional attachment order dated January 17, 2025, had alleged that there was a “deep-rooted nexus” involving MUDA officers, real estate businessmen and influential persons and that a large number of illegal allotments were made by MUDA officers against cash, immovable properties, vehicles, etc.

Apart from Siddaramaiah’s wife, the ED had named Abdul Wahid (41 sites), M Ravikumar and others (31), Cathedral Parish Society (40) and members of Chamundeshwari Nagara Sarvodaya Sangha (48) for “illegally” receiving major allotments of 1,095 sites.

The High Court had quashed the ED proceedings against Parvathi in this case. 

“The modus operandi was to make illegal allotments to ineligible persons who were front or dummy. These sites were subsequently projected as untainted, i.e., having been obtained as compensation for land acquired by MUDA. ... Further, these illegally allotted sites are being sold to obfuscate their true origin, i.e., proceeds of crime, and to frustrate proceedings under the PMLA, 2002. The resultant sale consideration obtained is being projected as untainted income from real estate business,” the ED alleged.