HYDERABAD: Co-accused in Karvy financial fraud Meka Yugandhar sought to take shelter under his role of non-executive director in the company to avoid arrest along with his co-founder of Karvy and prime accused C. Parthasarathy even as the Enforcement Directorate (ED) decided to investigate the multi-crore scam.
The ED will formally register a case and is said to have been in touch with the Hyderabad city police who have already arrested Parthasarathy and two others. Sources said the preliminary investigations indicated that the Karvy top management, apart from investing in stocks, also diverted funds for other purposes and the ED would focus on the money laundering angle.
Significantly, Yugandhar is the only top executive who managed to evade arrest despite being named as accused in the scam by all the three banks HDFC, IndusInd and ICICI with both the Hyderabad and Cyberabad police.
Inquiries by this newspaper revealed that he was summoned by the Central Crime Station (CCS) sleuths of Hyderabad on Monday but was let off while the Cyberabad police are yet to question him. The patronage enjoyed by Yugandhar was evident after the city police arrested chief operating officer (COO) Rajiv Ranjan Singh and chief financial officer (CFO) G. Krishna Hari on Thursday.
Sources said Yugandhar feigned ignorance about the misuse of clients’ shares as well as funds by Karvy. During the interrogation, he is said to have furnished crucial information about the transactions besides explaining how he was not responsible for the misdeeds. According to him, the board of directors took decisions as per law and authorised Parthasarathy to carry out the board’s decisions. “He put the blame squarely on Parthasarathy,” sources added.
When contacted, joint city police commissioner Avinash Mohanty said the police had been probing the roles and responsibilities of the top management including Yugandhar and would take further action. “We are examining his claims that he, as a non-executive director, has no role in the administration,” the police official pointed out.
The police also summoned independent directors Jyothi Prasad and B. D. Narang, who earlier headed the Global Trust Bank, and recorded their statements. Speaking to this correspondent from New Delhi, Narang said the board of directors took decisions as per law and was hopeful that the interests of the common investor were protected. The 75-year-old financial expert said he would extend all support to the investigating agencies.
