What Did the ED Discover in the Kamalakshi Cooperative Society Scam?
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Synopsis
The ED's investigation into the Kamalakshi Cooperative Society reveals a staggering misappropriation of Rs 32.73 crore in deposits. Discover how the main accused orchestrated this scam and how authorities are taking steps to recover the lost funds.
Key Takeaways
- The ED has confirmed a misappropriation of Rs 32.73 crore in the Kamalakshi Cooperative Society scam.
- Major figures involved include B V Laxminarayana, Asha Rao, and Radhika.
- Depositors were promised high interest rates but were ultimately defrauded.
- Funds were misused for personal property acquisitions.
- The investigation continues, with more actions expected from the ED.
Bengaluru, Sep 8 (NationPress) The Enforcement Directorate (ED) has uncovered significant misappropriation of Rs 32.73 crore in deposits within the Kamalakshi Vividodhesha Sahakara Sangha Niyamitha Cooperative Society scam originating from Udupi district in Karnataka.
In an official statement released on Monday, the ED confirmed: "On Sept 4, the Directorate of Enforcement (ED) in Mangaluru submitted a Prosecution Complaint to the Hon’ble III Additional District and Sessions Judge, Mangalore (Special Court PMLA), against Kamalakshi Vividodhesha Sahakara Sangha Niyamitha, B V Laxminarayana, Asha Rao, and Radhika, under the Prevention of Money Laundering Act (PMLA), 2002, concerning this cooperative society scam."
The investigation by the ED was initiated following multiple FIRs filed by the Udupi CEN Crime Police Station, Karnataka, under various sections of the IPC 1860, against B V Laxminarayana, Asha Rao, Radhika, and others.
Findings revealed that B. V. Laxminarayana, the President of the Cooperative Society, collaborated with Asha Rao, the Manager, and Radhika, the Director and wife of Laxminarayana, to raise funds totaling Rs 32.73 crore (Rs 32,73,98,448) from depositors by enticing them with promises of high interest rates reaching 15 percent per annum. They subsequently defaulted on interest and capital repayments.
Moreover, the investigation disclosed that the funds acquired from depositors were used by Laxminarayana to purchase immovable properties under his name and that of his wife, Radhika. These properties are currently subject to attachment under the Karnataka Protection of Interest of Depositors in Financial Establishments Act (KPIDFE), 2004, as stated by the ED.
Further inquiries are ongoing.
Earlier, on July 17, the ED conducted searches at over 15 locations in and around Bengaluru, related to a multi-crore fraud case involving three cooperative banks: Shushruti Souharda Bank, Shruthi Souharda Bank, and Shree Lakshmi Souharda Bank. These raids targeted locations associated with the banks' promoters and their families. The ED reported that over Rs 100 crore was allegedly misappropriated from more than 15,000 depositors, who were lured by the promise of excessive interest rates. Investigators noted that the accused utilized these deposits to extend unsecured loans to close associates, many of which later became non-performing assets.
Point of View
I emphasize the critical need for accountability in financial institutions. The ED's findings in the Kamalakshi Cooperative Society case highlight not only the vulnerabilities within these organizations but also the imperative for stringent regulatory measures to protect depositors' interests nationwide.
NationPress
09/09/2025
Frequently Asked Questions
What is the Kamalakshi Vividodhesha Sahakara Sangha Niyamitha scam?
The scam involves the misappropriation of Rs 32.73 crore in deposits by the cooperative society's office bearers, promising high interest rates but failing to repay depositors.
Who are the main accused in this scam?
The main accused include B V Laxminarayana, Asha Rao, and Radhika, who misled depositors while managing the cooperative society.
What actions has the ED taken regarding this scam?
The ED has filed a prosecution complaint under the Prevention of Money Laundering Act and continues to investigate the misuse of funds.
How did the accused misuse the deposits?
The accused mobilized funds from depositors under false pretenses and used the money for personal investments in properties.
What is the current status of the investigation?
The investigation is ongoing, with the ED actively pursuing further leads and examining additional fraudulent activities linked to the cooperative society.
