Code-named Operation Budget, the drive primarily looked at chitty scheme.
Kerala Finance Minister T.M. Thomas Isaac on Saturday slammed the Vigilance and Anti-Corruption Bureau (VACB) for executing a Statewide surprise raid on offices of the Kerala State Financial Enterprises (KSFE). The VACB anti-corruption drive, code-named Operation Budget, looked at the KSFE’s chitty scheme primarily.
According to officials, the VACB reportedly found large-scale irregularities in the availing of cash advance and loans on recurring deposits by chitty subscribers. It also detected manipulation in the bidding and draw of lots to favour some subscribers over others.
An official said the findings were preliminary. Only a detailed forensic audit would reveal the full extent of the violation of norms, including the value evaluation of title deeds as collateral for loans for subscribers who failed to get their chitties prized but required loans. The VACB also found that some KSFE staff had enrolled themselves in chitties and availed themselves of advances at the cost of other subscribers.
Dr. Isaac opposed the agency’s debatable finding that the KSFE did not deposit its revenue in the government treasury. “No law says the KSFE should deposit recurring deposits in the treasury. The VACB cannot set the law or arbitrate on what is right or wrong. The Law Department is there for such matters. The KSFE is not afraid of the VACB. It welcomes inspections,” he said.
Dr. Isaac also defended the conduct of ‘Pravasi chitties’ whose subscribers are predominantly non-resident Keralites and their families.
KSFE Chairman Philipose Thomas welcomed any anti-corruption investigation and said the functioning of the KSFE was transparent and above board. It had nothing to hide from watchdog agencies. He denied the allegation that the KSFE was a repository for black money and illegitimately earned wealth. He said KSFE remittances and deposits were by default referred to the Income Tax Department.
Moreover, the Comptroller and Auditor General and the Local Fund Department audited the KSFE independently. Furthermore, the KSFE had a robust internal audit mechanism.
Leader of the Opposition Ramesh Chennithala said Dr. Isaac had lashed out against the VACB out of frustration that the raid would expose embarrassing financial fraud. He also directly implicated Chief Minister Pinarayi Vijayan in a conspiracy to foist fake criminal cases against Congress leaders, including him.