The Enforcement Directorate (ED) has attached assets worth ₹1.3 crore belonging to former senior manager of Vijaya Bank, B.Y. Srinivas, in connection with a case involving funds being siphoned off from the Karnataka State Handicraft Development Corporation (KSHDC). The seized assets include land and bank accounts in his name as well as his associates, one H.S. Nagalingaswamy, and others.
Further investigation is in progress, said the ED in a press release on Thursday.
The case came to light in April last year, when the general manager (administration), KDHDC, in his complaint to the police alleged that general manager (finance) G.C. Kishore Kumar had opened a fake account in a nationalised bank in the name of the managing director of KSHDC, and diverted funds to the account between December 2016 and October 2018. The ED took up the case under Prevention of Money Laundering Act against Kumar and others.
Investigation under the Act revealed that Nagalingaswamy and his associates generated proceeds of crime to the extent of ₹16.67 crore, the ED said. The money was moved out of the bank accounts that KSHDC had with Vijay Bank to a fraudulent account at State Bank of India in the name of ‘Managing Director, KSHDCL’ using forged documents.
The cheating came to light when the managing director of KSHDC received a letter from the bank seeking authorisation for the account. “The amount was further diverted into the bank accounts of certain entities viz. M/s. Fralk Infotainment, M/s. PNP Enterprises and bank account in the name of one D. Narasaiah and from where the same was withdrawn and utilised by Nagalingaswamy and associates,” said the release.