What Led to the K’taka Bhovi Corporation Scam Involving Top Officials?
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Synopsis
The K’taka Bhovi Corporation scam has unveiled a shocking case of financial misconduct involving top officials. The ED's recent actions reveal a web of deceit and misappropriation of funds, raising critical questions about governance and accountability in public institutions.
Key Takeaways
- ED has seized properties worth Rs 26.27 crore.
- The scam involves misappropriation of funds meant for loans.
- Over 750 fake beneficiaries were allegedly created.
- Nagarajappa and Leelavathy have been arrested under PMLA.
- Ongoing investigations aim to uncover more details.
Bengaluru, May 26 (NationPress) The Directorate of Enforcement (ED) has provisionally seized immovable assets valued at approximately Rs 26.27 crore, with a current market worth of Rs 40 crore, belonging to former General Manager of the Karnataka Bhovi Development Corporation (KBDC), B. K. Nagarajappa, and the former Managing Director, R. Leelavathy. This action is part of an investigation into the Bhovi Corporation scam, as stated in an official release on Monday.
The ED's Bengaluru Zonal Office has taken this step under the Prevention of Money Laundering Act (PMLA), 2002, addressing a case of funds misappropriation from the Karnataka Bhovi Development Corporation (KBDC). The investigation uncovered that Nagarajappa and Leelavathy, in collusion with middlemen, have improperly allocated loans and financial assistance to over 750 fraudulent beneficiaries through bank accounts they had deceitfully opened.
According to the ED, the funds sanctioned from KBDC were diverted to several entities including Adithya Enterprises, Somanatheswara Enterprises, New Dreams Enterprises, Harntiha Creations, and Annika Enterprises, all controlled by Nagarajappa and his associates. These funds were utilized for acquiring properties, compensating middlemen, and transferring to various individuals and entities.
The misappropriated funds were primarily spent on sustaining their lavish lifestyles and purchasing both immovable and movable assets in their names and those of their family members, the statement added.
Previously, the ED arrested Nagarajappa and Leelavathy under Section 19 of the PMLA on April 5, 2025, and April 12, 2025, respectively, and they are presently in judicial custody.
Further investigations are ongoing, as the Bhovi Development Corporation scam, which allegedly took place during the previous BJP administration in 2021-22, involved the embezzlement of significant funds intended for a loan scheme aimed at members of the Bhovi community.
Point of View
It is crucial to highlight the integrity expected from public officials. The revelations surrounding the K’taka Bhovi Corporation scam underscore the need for stringent oversight and accountability in government institutions to prevent such egregious acts of corruption from undermining public trust.
NationPress
23/07/2025
Frequently Asked Questions
What is the Bhovi Corporation scam?
The Bhovi Corporation scam involves the misappropriation of funds intended for loans under a job scheme for the Bhovi community, leading to arrests of KBDC officials.
How much money was misappropriated?
Approximately Rs 26.27 crore was misappropriated, with a current market value of around Rs 40 crore attached by the ED.
Who were the key figures involved?
The key figures involved include B. K. Nagarajappa, the former General Manager, and R. Leelavathy, the former Managing Director of KBDC.
What action has the ED taken?
The ED has provisionally attached various immovable properties under the provisions of the Prevention of Money Laundering Act (PMLA).
Are the investigations ongoing?
Yes, the ED has confirmed that further investigations are in progress regarding the scam.
