The heated controversies surrounding the massive fraud in the Karuvannur Co-operative Bank are yet to douse completely. In the investigation, it was found that more than 300 crore rupees were stolen by many people with the tacit approval of the management. Despite many face-saving investigations, the people are still distraught as their valuable money has not yet been returned. The move to confiscate the properties of fraudsters to recover the lost money was also halted for unknown reasons.

Meanwhile, the ED raid on the former minister and current MLA A C Moideen’s house kickstarted more controversies hitherto shielded from the public. It is alleged that the big fraud in the Karuvannur bank case happened during Moideen’s tenure as the district secretary. Albeit having clear notions of fraud creeping within the system, Moideen decided to stay idle and not react, aiding the looters to run away with the cash. With the big fraud popping out in the last few days, the depositors wailed and protested in front of the bank to return their money. Some people are so caught in depression that it won’t be a far-shot idea for them to look upon suicide as a solace.

As the ripples of the Karuvannur Bank scam still hitting strong, other startling stories of cooperative investment fraud are also coming out one after another. Most recently, the story of an investment fraud of more than Rs 100 crore in the Kandala Cooperative Bank has rocked the government. The bank’s board members are currently resigning in flock and the power reigns have now fallen with the administrator. It is doubted that the big fraud in Kandala happened due to the tacit approval of authorities, who turned a blind eye toward the fraudulent schemes happening within the bank.

Investors who come to the bank for money are returning empty-handed. Many are protesting in front of the bank to make it palpable to the public about the distress heaved upon them by the fraud. Lack of discipline in financial transactions, favoritism, and nepotism are the downfalls of many cooperative banks.

A close look at all the co-op bank scams that have come out so far tells one thing. Improper auditing and a flawed accounting system create a breeding ground for massive fraud to prosper. The co-operative sector is completely politicized and everywhere the party interests of the governing body are given priority over the co-operative laws. The game plan works its way as more members will be added to the bank and loans will be allowed to them at a whim. A bitter example is the BSNL cooperative banks fall from grace after the authorities were accused of siphoning more than Rs 250 crores. Co-operative frauds that bankrupt investors can be curbed if the law is strengthened with systematic auditing to bring discipline.