Ruling CPI(M) protecting culprits of Karuvannur bank scam: Congress-led UDF

The Congress-led opposition UDF on Wednesday slammed the ruling CPI(M) in Kerala over the Karuvannur bank fraud case, by alleging that on one side the Left party said the investors wouldn't lose their money and on the other it was protecting the culprits behind the scam.

Terming the stand taken on the issue by Kerala Chief Minister Pinarayi Vijayan, CPI(M) and the state government as hypocritical, Leader of the Opposition (LoP) in the Assembly V D Satheesan demanded that immediate steps be taken to return the money of investors, which also includes Left party workers.

Satheesan, in a statement, accused the CPI(M) of trying to protect the culprits and justify their actions.

"The CPI(M) and the state government are not with the general public who are the victims. They are with the robbers who looted the investors," the LoP said.

The Congress leader also said that despite repeated demands from the opposition, the government has not taken any action on the issue of investor guarantees.

He alleged that the Left party and its government have also created a situation leading to a probe by the Enforcement Directorate (ED) by protecting the culprits and thereby, destroying the credibility of the cooperative sector -- the lifeline of Kerala.

Satheesan said the party should realise that when its leaders allegedly looted the bank, it put thousands of investors, including party workers, in a financial crisis.

"The government should take immediate action to return the money to depositors in cooperative banks including Karuvannur and Kandala (another cooperative bank in Kerala where similar fraud was reported," he said.

The ED on Tuesday arrested a local leader -- Wadakkanchery Municipal Councillor P R Aravindakshan -- of the party in connection with the Karuvannur bank fraud case, a move which the Left party termed as a "political witch-hunt."

The agency has also arrested a former employee of the Karuvannur cooperative bank, C K Jills, who allegedly syphoned off Rs five crore bank funds.

The ED had earlier arrested Kiran P P and Satheesh Kumar P in connection with the alleged issuance of benami loans from the Karuvannur bank.

On September 11, CPI(M) leader and MLA, A C Moideen, was interrogated for over nine hours by the ED in connection with its probe into the Rs 150 crore Karuvannur Cooperative bank scam which triggered a political row in Kerala recently.

The investigation into the alleged fraud, beginning in 2010, in the Thrissur-based bank stems from 16 FIRs registered by the Kerala Police (crime branch) in Thrissur.

The ED has said its probe has found that "on the instructions of certain persons, who were district-level leaders and committee members of a certain political party and governed the bank, loans were disbursed by the bank manager through the agent in cash to non-member 'benamis', by mortgaging properties of poor members without their knowledge and (the money) laundered to the benefit of the accused".

The ED had first carried out raids in this case in August last year at six locations, including a branch of the bank located in Irinjalakuda, Thrissur. It had attached assets worth Rs 30.70 crore of a commission agent of the bank named Bijoy A K.