The Enforcement Directorate has widened its investigation into alleged fraud in Kerala’s cooperative societies, reporting searches at about 17 premises and suspected irregularities across 27 cases involving approximately Rs 550 crore in proceeds of crime.
The searches were conducted on Wednesday in three cooperative society fraud cases, the agency said on Thursday. The investigations cover alleged fake loan applications, lending to ineligible or fictitious borrowers, illegal memberships and misappropriation of funds by office-bearers.
The action included searches linked to the Urban Co-operative Society in Angamaly and Ernakulam, the Thennela Service Co-operative Society and the Kuttanellur Co-op Bank in and around Thrissur. The ED said it seized property documents and digital devices and froze fixed deposits and bank accounts in two of the cases.
In the Urban Co-operative Society case, a police First Information Report alleges fraud of Rs 55 crore through fake loan applications, loans issued to ineligible persons and misappropriation of funds by office-bearers. The ED said its searches identified irregularities in 159 loans valued at Rs 33.82 crore.
The agency said it seized documents relating to 38 immovable properties and froze two fixed deposits worth approximately Rs 1.82 crore in the case. The property records and financial accounts are expected to form part of the agency’s investigation into the alleged proceeds of crime.
Seven premises were searched in the Thennela Service Co-operative Society case. According to the ED, Kisan Credit Card loans were sanctioned in the names of fictitious or benami members. The agency estimated the suspected proceeds of crime in this case at around Rs 10 crore and said it froze 20 fixed deposits and bank accounts containing Rs 24.50 lakh.
The third set of searches covered five locations in and around Thrissur linked to the Kuttanellur Co-op Bank and its former president, secretary and other officials. The ED said board members had allegedly granted membership and loans illegally to people outside the bank’s jurisdiction.
The agency said it has made cooperative society frauds a focus area to accelerate the recovery of funds and restitution to victims. The searches and freezing of deposits are part of the investigation and do not by themselves establish guilt. The cases will proceed through the legal process, based on the evidence collected by the agency and other authorities.
The developments place renewed attention on the internal controls governing cooperative societies, including membership eligibility, loan sanctioning, board oversight and the protection of depositors’ funds. The ED has not stated in the supplied report when the next phase of investigation or any recovery proceedings will be completed.
