Money laundering allegation at Wayanad's Brahmagiri Society puts CPM in a fix; Cong leader seeks ED probe

Wayanad: The CPM in Wayanad was pushed to a corner following allegations of financial irregularities involving the Brahmagiri Development Society (BDS), a quasi-government entity controlled by the party and affiliated with the state Dairy Department.

The controversy intensified when Congress leader Shaji Chulliod approached the Directorate of Enforcement (ED) on Thursday, requesting an investigation into alleged money laundering based on complaints from a former employee of the cooperative.

Noushad, the former employee responsible for mobilising funds for various projects, claimed in an interview with a Malayalam news channel on Wednesday that bundles of cash were delivered to the BDS office in sacks by agencies from Kozhikode. He alleged that this money was later legitimised through transactions at the Union Bank of India, after which it was deposited into the accounts of various employees and subsequently transferred to the Brahmagiri account.

Noushad also provided photographs showing large amounts of cash being handled at the BDS office in Sulthan Bathery. Hr told Onmanorama that he felt compelled to expose the alleged irregularities because the cooperative leadership had repeatedly deceived him.

"I had full faith in the party and deposited all my savings with Brahmagiri," he said, adding that the cooperative owes him approximately ₹22 lakh, including the promised interest on his deposits. He expressed concern that if the ED conducted an investigation, the "dark deals" of the party leadership would be revealed, claiming that all financial regulations were blatantly violated within the organisation.

While the allegations themselves have caused significant embarrassment for the CPM, party leaders are reportedly more worried about the formal complaint submitted to the ED by the Congress leader, as an investigation could seriously impact the party in the lead-up to the Assembly elections, according to political observers.

Opposition parties intensify attacks
This controversy has provided both the United Democratic Front (UDF) and the Bharatiya Janata Party (BJP) with an opportunity to target the CPM. Both parties have organised protest marches demanding action against CPM leaders allegedly involved in large-scale money laundering linked to Brahmagiri.

UDF-affiliated organisations held widespread protests across the district, including a march organised by the UDF Meenangadi panchayat committee, which called for immediate action against CPM leaders allegedly involved in "anti-national activities" at Brahmagiri.

The BJP also conducted a protest march to the Union Bank of India, accusing the bank of colluding in the conversion of black money by channelling funds through the accounts of BDS employees. BJP district president Prasanth Malavayal called for strict action against bank officials who allegedly facilitated these transactions.

Despite the seriousness of the allegations, CPM leaders have dismissed them as baseless. PK Suresh, a member of the CPM district secretariat and chairman of BDS, said that the leadership was unaware of any large-scale cash transactions violating financial norms. He added that strict action would be taken against staff members if any money laundering activities are proven.

It is important to note that the cooperative has mobilised around ₹100 crore from the public and over ₹30 crore from primary cooperative societies and cooperative banks across the Kozhikode, Kannur, Malappuram, Palakkad, and Wayanad districts. Sources indicate that members of these cooperative societies were unaware that large loans had been granted to BDS without adequate security, allegedly in violation of established norms.

Additionally, the BDS is facing multiple revenue recovery proceedings following court orders to return deposits to investors. Recently, more than 100 depositors organised a protest march to the BDS office in Manjadi, near Meenangadi.

Founded in 1999 by the late CPM leader and MLA P V Varghese Vaidyar, the Brahmagiri Development Society initially focused on producing sanitary products, including toilet cleaners and detergents. Under the leadership of Chairman P Krishna Prasad, the society pursued significant business expansion but reported heavy losses during the COVID-19 pandemic, despite a turnover of ₹36 crore in 2019.