Deposits totalling over Rs 500 crore were reportedly made in select district central co-operative (DCC) banks across the state, between November 9 and 14.
The income tax department and the Enforcement Directorate (ED), which launched a crackdown on District Co-operative Central (DCC) banks in Karnataka, reportedly found Rs 162 crore in cash deposits made at Bagalkot DCC bank alone, ranging between Rs 25 lakh and Rs 2 crore, soon after demonetization was announced on November 8. This is said to be the highest deposits made among all the DCC banks in the state.
What is more interesting is that the management of Bagalkot DCC involves politicians from the Congress and BJP. While former Congress minister Ajaykumar Sarnaik is the chairman of the bank, former ministers in the Siddaramaiah government S R Patil, H Y Meti and BJP's newly elected MLC Hanumanth Nirani are its directors. Officials have particularly expressed surprise about the deposits of Rs 162 crore at Bagalkot DCC bank, especially when agriculture is on the brink of collapse, following successive droughts.
On Thursday, IT sleuths had inspected the Belagavi Cooperative Bank, where they found huge deposits. The bank management involved several politicians. "We are looking into how this perennially ailing bank with accumulated losses and large non-performing assets mopped up crores of rupees in six days," I-T sources said.
Ditto in Dharwad, Haveri and Gadag, where DCC banks recorded deposits. "The ED teams will also verify accounts in DCCs in Ballari, Mandya, Shivamogga, Kolar and Dakshina Kannada districts, which have recorded unprecedented cash deposits," a source said.
It's apparent that politicians have used their connections in DCC banks to convert their unaccounted for wealth into new notes. "For many years, DCC banks have been used by politicians who open accounts in the names of farmers and use them for money laundering. They could have done the same after demonetization," said a former cooperative bank official in Dharwad.
"Farmers in Karnataka are consuming pesticide as they are unable to repay loan sharks. But many seem to have cleared their loans in those six days. This reveals how cooperative banks have been exploited by cash-rich politicians," said a senior official from the state agriculture department.
A senior manager of the cooperative bank, however, denied that this was a raid or there was any fraud. He said it seemed to be an inspection of transactions to verify whether unaccounted money has flowed into cooperative bank accounts. Registrar of cooperative societies M K Aiyappa said I-T and ED officials have refused to share any information with them so far.
The income tax department and the Enforcement Directorate (ED), which launched a crackdown on District Co-operative Central (DCC) banks in Karnataka, reportedly found Rs 162 crore in cash deposits made at Bagalkot DCC bank alone, ranging between Rs 25 lakh and Rs 2 crore, soon after demonetization was announced on November 8. This is said to be the highest deposits made among all the DCC banks in the state.
What is more interesting is that the management of Bagalkot DCC involves politicians from the Congress and BJP. While former Congress minister Ajaykumar Sarnaik is the chairman of the bank, former ministers in the Siddaramaiah government S R Patil, H Y Meti and BJP's newly elected MLC Hanumanth Nirani are its directors. Officials have particularly expressed surprise about the deposits of Rs 162 crore at Bagalkot DCC bank, especially when agriculture is on the brink of collapse, following successive droughts.
On Thursday, IT sleuths had inspected the Belagavi Cooperative Bank, where they found huge deposits. The bank management involved several politicians. "We are looking into how this perennially ailing bank with accumulated losses and large non-performing assets mopped up crores of rupees in six days," I-T sources said.
Ditto in Dharwad, Haveri and Gadag, where DCC banks recorded deposits. "The ED teams will also verify accounts in DCCs in Ballari, Mandya, Shivamogga, Kolar and Dakshina Kannada districts, which have recorded unprecedented cash deposits," a source said.
It's apparent that politicians have used their connections in DCC banks to convert their unaccounted for wealth into new notes. "For many years, DCC banks have been used by politicians who open accounts in the names of farmers and use them for money laundering. They could have done the same after demonetization," said a former cooperative bank official in Dharwad.
"Farmers in Karnataka are consuming pesticide as they are unable to repay loan sharks. But many seem to have cleared their loans in those six days. This reveals how cooperative banks have been exploited by cash-rich politicians," said a senior official from the state agriculture department.
A senior manager of the cooperative bank, however, denied that this was a raid or there was any fraud. He said it seemed to be an inspection of transactions to verify whether unaccounted money has flowed into cooperative bank accounts. Registrar of cooperative societies M K Aiyappa said I-T and ED officials have refused to share any information with them so far.