Karuvannur bank scam: Court orders trial for senior CPM leaders, K Radhakrishnan and A C Moideen among 28 accused directed to appear before court

KOCHI: The legal troubles surrounding the alleged loan and deposit fraud of more than Rs 300 crore at the Karuvannur Service Cooperative Bank have deepened for the CPM and several of its senior leaders. A special court in Kochi has accepted a supplementary chargesheet filed by the Enforcement Directorate (ED) and ordered the accused to stand trial. The chargesheet, filed under the Prevention of Money Laundering Act (PMLA), names 28 accused, including CPM leaders and elected representatives.

Among those named are A C Moideen, former CPM Thrissur district secretaries K Radhakrishnan and M M Varghese, Irinjalakuda area secretary K C Premarajan, Porathissery North local secretary A R Peethambaran, and Porathissery South local secretary M B Raju.

Special Judge P Sabareenathan observed that there was prima facie evidence against the accused and issued summons directing them to appear before the court on July 4. The court also noted that A C Moideen and K Radhakrishnan were not public representatives during the period when the alleged offences took place, and therefore no special sanction was required to prosecute them.

The case now has 83 accused in total. The chargesheet runs to around 30,000 pages. The CPM, along with Moideen, Varghese and Radhakrishnan, are listed as accused numbers 67 to 70. The ED filed its first chargesheet last year, and the trial against 55 accused, including former bank employees and former Wadakkanchery municipal councillors P R Aravindakshan and Madhu Ambalapuram, has already begun. Special Public Prosecutor M J Santhosh appeared for the ED.

Party building funded by commissions from illegal loans

• CPM: According to the allegations, irregularities in the functioning of the party-controlled bank came to light during 2012-13. Following this, the CPM's Thrissur district committee appointed a sub-committee to oversee the bank's administration. The panel included district secretariat member C.K. Chandran. The sub-committee allegedly recommended the sanctioning of large loans to ineligible borrowers. Many of these loans were not repaid, resulting in losses worth crores of rupees to depositors. Investigators allege that the party became complicit in the fraud through its involvement in the bank's affairs. In 2017, the local committee decided to purchase land and construct a party office at Porathissery, a move that reportedly received approval from the district secretariat. A bank account was opened under the name "PRY Building Fund," and commissions allegedly collected from beneficiaries of illegal loans were deposited into this account.
• K Radhakrishnan: The agency alleges that, while serving as district secretary, he directed that commissions collected from illegal borrowers be deposited into the building fund account.
• M M Varghese: During his tenure as district secretary, money from the account was used to purchase land in Porathissery for a party office in his name.
• A C Moideen: The chargesheet alleges that he played a key role in appointing the sub-committee, pressured the bank's management to approve illegal loans, and that funds linked to the fraud were used for election-related activities.
• Area and Local Secretaries: They are accused of involvement in irregularities related to raising funds for the construction of the party office.