ED Arrests Former Congress MP of Andaman & Nicobar, Two Others in Bank Loan Fraud Case
According to officials, ED sleuths from the Kolkata zonal office arrested Sharma, former chairman of the Andaman and Nicobar State Cooperative Bank Ltd (ANSCBL), along with K. Murugan, former managing director, and K. Kalaivanan, former loan officer, under the provisions of the Prevention of Money Laundering Act (PMLA), 2002, on Wednesday evening.
New Delhi: The Enforcement Directorate (ED) on Thursday said it has arrested former Congress MP from the Andaman and Nicobar Islands, Kuldeep Rai Sharma, in connection with the ANSCBL loan scam and brought him to Kolkata.
According to officials, ED sleuths from the Kolkata zonal office arrested Sharma, former chairman of the Andaman and Nicobar State Cooperative Bank Ltd (ANSCBL), along with K. Murugan, former managing director, and K. Kalaivanan, former loan officer, under the provisions of the Prevention of Money Laundering Act (PMLA), 2002, on Wednesday evening.
A Special Court (PMLA) has remanded the three to ED custody for eight days. Sharma, Murugan, and Kalaivanan were taken from Port Blair to Kolkata on Thursday. “They will be taken to our ED office at Salt Lake after their medical examination. Our officers went to Port Blair on September 15 and conducted raids at several offices and residences of businessmen and bank officials. The investigation is ongoing, and more updates will follow,” a senior ED official said.
The case stems from an FIR registered on May 15, 2025, by the Crime & Economic Offences Cell of the Andaman & Nicobar Police against bank officials and private individuals. Sharma had earlier been arrested by the Cell on July 18 in connection with loan irregularities, based on a complaint from the deputy registrar of cooperative societies alleging large-scale irregularities in sanctioning loans.
The ED launched its own probe soon after and conducted its first search operation in the islands on July 31. Over the past two weeks, it has summoned more than 10 individuals to Kolkata for examination.
Investigations have revealed a wide-ranging conspiracy in which loans worth over ₹500 crore were sanctioned fraudulently through more than 100 accounts opened in the names of shell companies and firms. According to the ED, about ₹230 crore was allegedly siphoned off for the benefit of Sharma and his close associates, including the then MD and loan officer of ANSCBL.
“The officials not only sanctioned loans in blatant violation of banking norms but also facilitated multiple loans for associates in exchange for a 5% commission, routed either through cash or shell company accounts,” the ED said in a statement.
Further searches are underway at three premises in the Andaman and Nicobar Islands, following earlier raids at 21 locations on July 31 and August 1. “Investigations indicate that large portions of the loan amounts were withdrawn in cash and distributed as illegal gratification among senior bank officials, including the former MP,” the statement added.
