The Enforcement Directorate (ED) on 8 October 2026 revealed that suspended Karnataka Public Service Commission (KPSC) Chairman Sahukar Shivashankarappa, KPSC Member B.V. Geetha, and IAS officer Gyanendra Kumar Gangwar allegedly operated as an organised gang to manipulate the recruitment process for 400 veterinary officer posts, generating substantial proceeds of crime. The ED, which arrested all three in connection with its money laundering investigation, described the arrangement as a structured racket involving paper leaks, answer key distribution, and cash bribes.

How the Racket Allegedly Worked

According to the ED's official statement, the modus operandi centred on three key mechanisms: leakage of question papers, supply of candidate-specific answer keys, and exploitation of the 1:3 merit list to extract payment from aspirants. The agency stated that certain candidates received correct answer keys just before the Veterinary Officers' Recruitment Examination — specifically on 8 January 2026 — in exchange for bribes ranging from ₹20 lakh to ₹40 lakh per candidate.

The ED alleged that Gangwar, then serving as Controller of Examinations (CoE) at KPSC, had custody and supervision of confidential examination material. He reportedly used seating arrangements and access to jumbled question papers and answer keys to extract the correct answer sequence for the first 80 questions, which he then passed on to Geetha.

Money Trail and Arrests

Investigators allege that Geetha collected ₹20 lakh in cash as an advance from at least one candidate against an agreed total of ₹40 lakh. Separately, Shivashankarappa is alleged to have received ₹10 lakh in cash as an advance from another candidate, against a total agreed bribe of ₹20 lakh. So far, six candidates who secured higher scores in the final selection list have been identified, and the ED has said further investigation is ongoing to identify all such individuals.

The ED, operating out of its Bengaluru Zonal Office, conducted searches at the premises of Shivashankarappa and Geetha on 6 October under Section 17 of the Prevention of Money Laundering Act (PMLA). Both were arrested the same day under Section 19 of the PMLA. At the time of reporting, Shivashankarappa and Geetha were still being questioned by the agency, while Gangwar and BJP leader Basavaraj Kannale have been remanded to judicial custody.

Legal Framework and FIRs

The ED's investigation is based on multiple FIRs registered at Vidhana Soudha Police Station, Bengaluru, for offences punishable under Sections 318(3), 318(4), 336(3), and 340(2) of the Bharatiya Nyaya Sanhita (BNS) 2023. The agency characterised the arrangement as an 'organised mechanism' for generation of proceeds of crime through systematic manipulation of the recruitment process.

Broader Implications for Karnataka's Public Services

This is not Karnataka's first public service recruitment controversy, but the involvement of a sitting IAS officer in the role of examination controller marks a significant escalation in the alleged depth of institutional compromise. The KPSC oversees recruitment to state government services, meaning manipulation at this level could have affected hundreds of legitimate candidates. Critics argue that the case underscores the need for independent examination oversight mechanisms that do not vest excessive control in individual officers.

The ED has indicated that the investigation is still progressing, with more accused potentially to be identified as the full candidate list is examined.