Valmiki corporation scam: ED raid on former minister B. Nagendra, and Corporation Chairman and Congress MLA Basanagouda Daddal

The scam came to light when the corporation’s accounts superintendent P. Chandrashekharan ended his life on May 26. In a note, he alleged illegal transfer of money from the corporation to various accounts. The Mumbai-headquartered Union Bank of India, in its complaint to the Central Bureau of Investigation (CBI) had alleged embezzlement of funds amounting to ₹88 crore.

The Directorate of Enforcement (ED) simultaneously searched over 20 premises linked to accused and suspects in the alleged scam at the State-run Maharshi Valmiki Scheduled Tribes Development Corporation where funds up to ₹88 crore were allegedly embezzled.

They are searching premises linked to two ruling Congress MLAs — Ballari Rural MLA B. Nagendra, who resigned as minister for Scheduled Tribes Welfare on June 6 in connection with the alleged scam, and Raichur Rural MLA Basanagouda Daddal, who is Chairman of the corporation. 

The ED raids come a day after Mr. Nagendra and Mr. Daddal, were questioned in connection with the scam by the SIT, on July 9. Till date, the SIT has arrested 11 persons and seized ₹14.5 crore in connection with the alleged scam.

Others raided by the ED include key accused J. J. Padmanabh, Managing Director of the corporation, Parashuram, an accountant at the corporation, three employees of the Union Bank of India, M. G. Road branch in Bengaluru where the alleged money laundering happened. The ED has taken security cover from the Central Reserve Police Force (CRPF) for the raids and not the Karnataka State Police. ED officials knocked on the doors of those raided as early as 3.30 a.m., sources said.

ED is searching three residences of Mr. Nagendra — two in Bengaluru and one in Ballari city, Mr. Daddal’s residence in Raichur, his room in the Legislator’s Home in Bengaluru, the corporation’s head office in Vasanth Nagar, Bengaluru, apart from residences of the other accused. 

Mr. Nagendra and Mr. Daddal were present at their residences during the raids, and were questioned by ED officials, sources said.

The scam came to light when the corporation’s accounts superintendent P. Chandrashekharan ended his life on May 26. In a note, he alleged illegal transfer of money from the corporation to various accounts. The Mumbai-headquartered Union Bank of India, in its complaint to the Central Bureau of Investigation (CBI) had alleged embezzlement of funds amounting to ₹88 crore.