Cooperative Society scam: ED investigation proves misappropriation of Rs 32.73crore deposits

ED Cracks Down on Udupi Cooperative Society Scam: Accused Misappropriate Rs 32.73 Crore from Depositors

Bengaluru’s financial world just got a big shake-up as the Enforcement Directorate (ED) uncovers a massive scam involving a cooperative society in Udupi’s Kamalakshi Vividodhesha Sahakara Sangha Niyamitha. The investigation shows that office bearers siphoned off Rs 32.73 crore from innocent depositors, promising sky-high returns that never materialized. This money laundering case under the Prevention of Money Laundering Act (PMLA) 2002 has now led to a prosecution complaint against key players.

On September 4, the ED’s Mangaluru team filed charges before the Special Court PMLA in Mangalore. They targeted the cooperative society itself, along with B V Laxminarayana (the president), Asha Rao (the manager), and Radhika (Laxminarayana’s wife and director). It all started with multiple FIRs from Udupi CEN Crime Police Station under various Indian Penal Code (IPC) sections, kicking off the ED’s probe into this cooperative society scam.

Picture this: Laxminarayana, with help from Asha Rao and Radhika, lured depositors with promises of up to 15% annual interest. They collected a whopping Rs 32.73 crore (exactly Rs 32,73,98,448) under the names of the society and Ganapathi Investments. But instead of safe investments, the money vanished. Depositors got cheated when the accused defaulted on interest payments and even the principal amount. It’s a classic case of fraud that left many families in financial distress.

Digging deeper, the ED found that Laxminarayana used these funds to buy properties in his name and Radhika’s. Authorities under the Karnataka Protection of Interest of Depositors in Financial Establishments Act (KPIDFE) 2004 have already attached these assets. The investigation into this money laundering probe continues, so stay tuned for more updates on the accused.

This isn’t the ED’s first rodeo in Karnataka’s banking fraud scene. Back on July 17, they raided over 15 spots around Bengaluru in another multi-crore cheating case. This one involved three cooperative banks: Shushruti Souharda Bank, Shruthi Souharda Bank, and Shree Lakshmi Souharda Bank. Promoters and their families came under the scanner as officials revealed how over Rs 100 crore got swindled from more than 15,000 depositors. The trick? High-interest lures again, but the cash went into unsecured loans for insiders, turning into bad debts.

If you’re worried about cooperative bank scams or money laundering in India, this highlights why vigilance matters. The ED’s actions show they’re serious about protecting depositors in Karnataka and beyond. We’ll keep following this Karnataka scam story as it unfolds.