Thrissur: Four members of the now-disbanded governing council of the Karuvannur Cooperative Bank have been arrested in connection with the Rs 300-crore fraud.
Former bank president KK Divakaran and governing council members C Jose, TS Baiju and VK Lalithan are among the arrested. Three are regional leaders of the Communist Party of India (Marxist) (CPM) and one belongs to the CPI.
Divakaran, who is currently under suspension, was the member of the CPM's Madayikonam school branch committe that comes under the Porathisseri local committee.
Jose and Baiju too are members of a local committe, whereas Lalithan is a member of the CPI.
This is the first time the members of the former governing council are being arrested in connection with the case. They have been accused of faking signatures to secure loans illegally.
They will be presented at the court on Monday.
The CPM-controlled bank had incurred a loss of over Rs 300 crore in the scam, according to preliminary estimates. The case had rocked the party's Thrissur district unit as the accused are associated with the party. Bank staff, including the secretary, were suspended soon after the police registered a case against them.
A key accused in the case T R Sunil Kumar has stood firm on his stance that the former governing body was fully responsible for the fraud. Sunil (58) was a member of the CPM Karavannur local committee and the secretary of the Karavannur bank for the past 21 years.