Major setback for CPM as Kochi PMLA Court orders trial in Karuvannur Bank fraud case

In a major setback to the CPI(M) and its leaders, the Special Court under the Prevention of Money Laundering Act (PMLA) in Kochi on Saturday accepted the supplementary charge sheet filed by the Enforcement Directorate (ED) against 28 accused, including CPI(M) leaders, in the alleged money laundering case linked to the Karuvannur Service Cooperative Bank fraud in Thrissur.

The court observed that there is sufficient prima facie material against the accused and ordered that all 28 individuals named in the supplementary charge sheet face trial in the case.

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The court formally accepted the charge sheet filed by the ED and issued summons to the accused, including CPI(M) leaders A. C. Moideen MLA, K. Radhakrishnan MP, and CPI(M) Thrissur District Secretary M. M. Varghese.

In an unusual development under the PMLA, the CPI(M) itself has also been arraigned as an accused in the case. The ED has alleged that the party’s Thrissur district unit maintained undisclosed accounts and received proceeds of crime, which were allegedly used to purchase land and construct party offices.

The court’s order followed detailed proceedings to determine whether sufficient grounds existed to proceed with a formal trial.

The Karuvannur Service Cooperative Bank scam involves the alleged siphoning and laundering of funds estimated between ₹180 crore and ₹300 crore through fraudulent loans.

According to the prosecution, the CPI(M)-controlled governing body of the bank sanctioned multiple fake loans using the same real estate collateral, without the knowledge of ordinary members, and diverted the proceeds to benami beneficiaries and political accounts.

The Enforcement Directorate has so far provisionally attached assets worth ₹128 crore in connection with the investigation. With a total of 83 accused named across the main and supplementary charge sheets, the trial is expected to commence after the next scheduled appearance in July.