Bengaluru: The Central Bureau of Investigation (CBI) has uncovered the role of some bankers in Bengaluru who allegedly helped bureaucrats and contractors exchange crores of demonetised currency with new notes. Initial findings points to a massive effort to fraudulently divert new currency meant for the banks’ customers to private individuals.
In an FIR registered by the CBI, investigators have identified the Indiranagar branch of Karnataka Bank and the J.C. Road branch of Dhanalaxmi Bank as the source of the biggest new currency haul during last week's I-T searches in the city. Sleuths had found Rs 5.7 crore in new Rs. 2,000 denomination notes from the premises of bureaucrats and contractors.
CBI sleuths are questioning Suryanarayana Bairy, Chief Manager, Karnataka Bank, Indiranagar and Umashankar Renuka, branch manager, Dhanalaxmi Bank, J.C. Road along with officials of an ATM logistics firm
Two types of frauds perpetuated
The FIR narrates two kinds of fraud. One involved the diversion of new currency using falsified ID documents to misrepresent exchange at banks before November 24. In the second, money meant for ATM kiosks was diverted for illegal exchange with old currency.
The FIR reveals that Suryanarayana Bairy unauthorisedly diverted new currency.
He allegedly ‘falsified the accounts of his bank on the basis of forged and fabricated documents of identity and address proof in the names of several individuals to misrepresent that the new currency notes were exchanged with the general public at the bank counters.” The CBI has seized applications along with ID proofs submitted to the bank for exchange of old notes and vouchers through which money was withdrawn.
Monies for ATM diverted
At the J.C. Road branch of Dhanalaxmi Bank, the FIR alleges that Umashankar Renuka, manager, and representatives of M/s. Secure Value India Ltd., a logistics firm contracted to move and refill cash in ATMs, diverted the money to private individuals.
Umashankar Renuka gave Rs. 1.30 crore to Secure Value India Ltd, to refill 32 ATMs between November 8 and November 29, but the money was diverted to Ibrahim Shereef, S.C. Jayachandra, Nazeer Ahmed, Chandrakanth Ramalingam and some others.
ED arrests S.C. Jayachandra
The Enforcement Directorate (ED) arrested suspended Public Works Department engineer S.C. Jayachandra for allegedly laundering money and exchanging demonetised notes with new currency. He was remanded in police custody for five days.
Another bureaucrat T.N. Chikkarayappa, whose house was also searched by I-T sleuths last week, is not part of the FIRs registered by either the CBI or ED as no new currency notes were recovered from his house. However, the Anti Corruption Bureau (ACB) of the State police has registered a Disproportionate Assets (DA) cases against him and S.C. Jayachandra, and initiated a probe.
CBI arrests two middlemen
The CBI on Sunday arrested two contractors Nazeer Ahmed and Chandrakanth Ramalingam for allegedly acting as middlemen for the illegal exchange of old currency with notes of Rs. 2,000 denomination.
Ibrahim Shereef, another contractor, has emerged as one of the kingpins in the racket. He is absconding.
I-T sleuths recovered Rs. 4.80 crore in Rs. 2,000 denomination notes from a flat owned by Ibrahim Shereef at Pebble Bay, RMV Extension II stage.
All the seven persons named in the FIR have been booked for criminal conspiracy, cheating, misappropriation, forgery, falsification of accounts and criminal misconduct by public servants. Both CBI and ED have got custody of the persons till December 9.
Scope of fraud likely to expand?
The scope of the banking fraud is most likely to expand, both in terms of volume and the number of banks involved, sleuths told The Hindu .
The CBI and the ED are working in tandem with the I-T department and RBI to track down the source of all the Rs. 2,000 denomination notes that I-T sleuths had seized.
Sources said that at least two public sector banks banks in Tamil Nadu have already come under the scanner.
Chandrakanth Ramalingam is suspected of being a middleman in these transactions too.
M/s. Secure Value India Ltd., a Mumbai-based firm incorporated in 2012, was handling funds of 18 other banks in Bengaluru and Mumbai. Sleuths are probing the accounts of all these banks.
Police hunt for key player
Sleuths are on the hunt for Ibrahim Shereef. It was in his flat in Pebble Bay, RMV II Stage that new currency amounting to Rs. 4.8 crore was seized. According to sources, he is a well-known power broker, who is close to many politicians. He is from Thrithahalli in Shivamogga district and is a Class I contractor.
Ibrahim Shereef has several flats in Pebble Bay. Most of them are said to be unoccupied. Sleuths suspect that the flats may be benami properties. It was from one such flat that the new currency was seized, sources said.
Sleuths have seized the visitor entry registers and CCTV camera footage.
