Hyderabad: Even as the Hyderabad Central Crime Station (CCS) police are finalising their course of action in the investigation into the Karvy Stock Broking Private Limited (KSBL) loan fraud, the Enforcement Directorate (ED) had stepped up investigation into the money-laundering angle of the scam.
It is highly likely that C. Parthasarathy, the chairman of KSBL, will be questioned by the ED officials in the days to come.
The CCS police have already questioned Parthasarathy and appear to have secured information from him to tighten their case. Parthasarathy has been in custody of the Hyderabad police for four days on Aug 25, 26, 29, and 30.
On the complainant of IndusInd Bank, Hyderabad, a case was registered at the CCS detective department (DD) against Karvy over the allegation of availing credit facilities of Rs 137 crore from the bank by pledging securities/shares of its clients in contravention to Sebi guidelines. KSBL diverted funds raised through alleged fraud into its own and connected businesses entities.
Sources in the police department told this newspaper, "The ED has been following the case even before the arrest of Parthasarathy by the Hyderabad police. After the arrest, the ED has started looking deeply into the fraud." It is learnt that all the details of investigation by the Hyderabad police have been shared with the ED officials. Further, the Central agency has intensified investigation into the money laundering angle of KSBL.
The Hyderabad police's investigation revealed that the accused also diverted Rs 720 crore of client funds which were lying in the banks linked with their trading account.
In the next few days, the ED might approach the court seeking the custody of Parthasarathy. So far, Parthasarathy is said to be cooperating with his interrogators of CCS police. He is believed to have shared a lot of information relating to the fraud. Sources privy to the investigation told this correspondent, "Parthasarathy is cooperating and has submitted the required documents requested by us. After verifying the same, those documents will be presented in the court." It is further learnt that Parthasarathy revealed where he diverted the money.
Meanwhile, the CCS police are contemplating to question a few others from KSBL as it is highly impossible handle such a huge fraud by questioning only one.
Two more cases are registered with CCS against KSBL and Karvy Commodities Pvt Ltd pertaining to loan frauds amounting to Rs 340 crore and Rs 7 crore approximately. The Hyderabad police might approach the court for the police custody of Parthasarathy in these two cases.
In addition to the cases lodged in Hyderabad commissionerate, a case was booked by Cyberabad police against KSBL. The Cyberabad police are setting the stage to question Parthasarathy. Recently, the Cyberabad police booked a loan fraud case to a tune of Rs 563 crore based on the complaint by ICICI Bank. The complainant alleged that KSBL availed credit facilities from ICICI Bank by pledging securities/shares of their clients and defaulted to a tune of Rs 563 crore.
The Cyberabad police booked Parthasarathy and also M. Yugandhar Rao and M.S. Ramakrishna who are said to be promoters of KSBL. They called Yugandhar Rao for questioning related to the loan fraud. As the investigation deepens into the KSBL loan fraud, the Central agency might also attach some of his properties in near future.
Speaking to this newspaper, additional commissioner of police (crimes and SIT), Hyderabad, Shikha Goel refused to divulge any details regarding the next course of action in the KSBL fraud case.