Auditors' oversight glaring in Karuvannur bank scam, 16 suspended

CPM's Thrissur district leadership kept Karuvannur bank fraud under wraps

Thrissur: The Department of Co-operation has finally started cracking the whip against officials responsible for the massive fraud that took place at the Karuvannur Cooperative Bank in Irinjalakuda.

Based on the interim report submitted by the nine-member high-power committee constituted by the department to probe the matter, as many as 16 audit officials including the joint registrar were suspended on Wednesday.

The panel has recommended probe against the retired officials and prompt action if found guilty.

The findings of the interim report

• The responsibility of administration and audit at the Karuvannur Bank was with the joint registrar, assistant registrar and unit inspector. Despite having the responsibility to conduct inspection at three levels, they failed to carry out the checks effectively.

• Though financial irregularities had been taking place in the bank since 2011, the audit officials failed to detect these at the right time and report the matter to the higher-ups.

• The audit reports filed between 2014-19 had mentioned about the financial irregularities. But despite that the officials failed to prevent the irregularities or take action.

• A post of concurrent auditor was sanctioned for the bank. However, no special reports were submitted in connection with the irregularities. As per rules prior to submitting the audit report, a test audit has to be carried out. However this was also not done.

• There were serious lapses on the part of the officials along with the bank's administrative committee.

Where was the money siphoned off

The accused Biju Karim and CK Jill's have given statements to the effect that of the Rs 100 crore siphoned off from Karuvannur Bank, Rs 14 crore was paid to money lenders. They said huge amounts were taken as loan from two money lenders at a very high interest rate, following losses worth crores of rupees in real estate deals.

The accused started getting threats from the money lenders when the dues mounted to Rs 14 crore.

In view of the threats, loans were passed in fake names to clear the dues of money lenders, the duo admitted.

Arrests so far, three on the run

The number of accused arrested in the case has gone up to three with the arrest of Karim and Jill on Wednesday.

The first accused and bank's former secretary T R Sunil Kumar was arrested the other day.

Fifth accused and commission agent A K Bijoy and sixth accused and bank's former accountant Reji Anil are reportedly under Crime Branch surveillance. They are likely to surrender soon.

Though the Crime Branch has received information that the fourth accused and middleman Kiran is in Andhra Pradesh, he is yet to be traced.

A few accused were reportedly hiding in Thrissur itself even when the Crime Branch repeatedly stated that search operations are being carried out in three States.

Karim and Jills were reportedly hiding in various parts of Thrissur. Despite carrying out massive search for three weeks, the police could not trace the accused. However it came to notice that the accused had contacted a couple of lawyers seeking legal help even while being in the hiding. One among them was hiding in Irinjalakuda which is just a few kilometres away from Karuvannur.

The comments posted here/below/in the given space are not on behalf of Onmanorama. The person posting the comment will be in sole ownership of its responsibility. According to the central government's IT rules, obscene or offensive statement made against a person, religion, community or nation is a punishable offense, and legal action would be taken against people who indulge in such activities.