Is the ED Intensifying its Probe into the Cooperative Bank Fraud in Thiruvananthapuram?
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Synopsis
In a significant escalation of the investigation into the Nemom Service Cooperative Bank fraud, the ED has seized crucial documents and property papers, revealing a shocking scale of financial mismanagement. This development raises serious concerns about depositor safety and regulatory oversight just before local elections in Kerala.
Key Takeaways
- The ED has intensified its investigation into the Nemom Service Cooperative Bank fraud.
- Significant financial irregularities have been identified, amounting to nearly Rs 100 crore.
- Political implications are rising as local elections approach.
- The investigation reflects growing concerns over cooperative banking regulations in Kerala.
- Deposit safety remains a critical issue for investors.
Kochi, Nov 10 (NationPress) The Enforcement Directorate (ED) has confiscated various incriminating documents and property-related papers following extensive search operations at five locations in Thiruvananthapuram linked to the money-laundering investigation concerning the Nemom Service Cooperative Bank Ltd and others, accused of defrauding depositors, as reported by an official on Monday.
The ED's raid, conducted on November 7, lasted several hours, with armed officials from the Central forces maintaining security.
The investigation, spearheaded by the ED’s Kochi Zonal Office under the Prevention of Money Laundering Act (PMLA), 2002, revealed the confiscation of numerous incriminating documents, property-related papers, and 15 original fixed deposit receipts valued at approximately Rs 50 lakh.
In a statement, the federal agency announced plans to intensify the probe.
This search signifies a new phase in the ongoing investigation into alleged financial irregularities amounting to nearly Rs 100 crore in the cooperative bank, previously managed by a CPI(M)-led panel.
The situation has attracted political attention, particularly as it arises just weeks ahead of local body elections in Kerala.
Earlier this year, the bank came under fire as several depositors reported issues with the repayment of their savings, prompting an inquiry by the Cooperative Department.
The investigation, conducted under Section 65 of the State Cooperative Rules, unveiled significant irregularities in loan disbursal, unsecured advances, and poor management of deposit schemes.
The inquiry report indicated that the bank disbursed loans totaling Rs 34.26 crore, while only Rs 15.55 crore was backed by collateral.
Out of the Rs 10.73 crore collected from the Monthly Investment Scheme, only Rs 4.83 crore remained in the bank’s accounts.
The Cooperative Department attributed losses exceeding Rs 60 crore to several former secretaries and board members, with Rs 31.63 crore linked to one official alone.
Investigators discovered that numerous loans were sanctioned in the names of relatives of bank officers, posing a low probability of recovery.
Additionally, excessive interest payments on deposits and unrecorded transactions have exacerbated the crisis.
Previously, the Crime Branch’s Economic Offences Wing arrested three individuals.
The bank, currently under an administrator, has outstanding dues approximating Rs 35 crore, though recoveries are anticipated to be minimal.
The ED's involvement comes amid escalating protests from investor groups demanding the return of deposits and stricter regulation of Kerala’s cooperative banking sector, which has been plagued with allegations of political meddling and mismanagement.
Point of View
It is vital to observe the unfolding situation in Thiruvananthapuram with a balanced perspective. The Enforcement Directorate's actions reflect a necessary step in ensuring accountability within the cooperative banking system, particularly given the alarming claims of mismanagement and fraud that have surfaced. This investigation not only seeks justice for the depositors but also aims to restore public confidence in the cooperative banking framework.
NationPress
11/11/2025
Frequently Asked Questions
What triggered the ED's investigation into the Nemom Service Cooperative Bank?
The ED's investigation was triggered by numerous depositors' complaints regarding non-repayment of their savings, leading to an inquiry by the Cooperative Department.
What are the findings of the inquiry conducted by the Cooperative Department?
The inquiry revealed large-scale irregularities in loan disbursal and mismanagement of deposit schemes, with losses exceeding Rs 60 crore attributed to former officials.
What are the implications of the ED's findings?
The ED's findings indicate serious financial mismanagement and raise concerns about the safety of deposits within the cooperative banking sector, especially ahead of local elections.
What actions have been taken by the authorities so far?
The authorities have seized incriminating documents, and the Crime Branch's Economic Offences Wing has arrested three individuals related to the scandal.
What is the current status of the Nemom Service Cooperative Bank?
The bank is currently under an administrator and has outstanding dues of approximately Rs 35 crore, with limited recovery prospects.
