Kochi: The Enforcement Directorate (ED) on Wednesday conducted searches at 17 premises across Kerala linked to three co-operative societies/banks as part of investigations into alleged fraud involving around ₹550 crore in 27 cases.

The searches covered the Urban Co-operative Society Ltd, Angamaly; Thennala Service Co-operative Bank Ltd; and Kuttanellur Co-operative Bank. The ED said thousands of co-operative society and bank members had lost their hard-earned money in such frauds and that recovery of the alleged proceeds and restitution to victims were among its focus areas.

At the Urban Co-operative Society, Angamaly, five premises in Ernakulam and nearby areas linked to Roy Kurian, Kurian Joseph and Shiju, who are accused of fraudulent transactions, were searched. The case stems from an Angamaly police FIR alleging fake loan applications, sanctioning of loans to ineligible persons and misappropriation of society funds. The alleged fraud was estimated at around ₹55 crore.

The ED said 422 loans worth ₹96.74 crore had been sanctioned against 108 immovable properties belonging to 65 members. Serious irregularities were found in 159 loans worth ₹33.82 crore, including absence of original title deeds, use of photocopies, lack of registered mortgages, incomplete applications and loans sanctioned to ineligible or non-existent persons.

“Investigation has revealed that 422 loans amounting to approximately ₹ 96.74 crore were sanctioned against 108 immovable properties belonging to 65 members. Serious irregularities were identified in 159 loans amounting to approximately ₹33.82 crore, including absence of original title deeds, use of photocopies of deeds, absence of registered mortgage, incomplete loan applications and loans sanctioned in the names of ineligible/non-existent persons,” the ED said.

According to the ED, documents relating to fraudulent loans and 38 immovable properties, digital devices, mobile phones and other evidence were seized. Two fixed deposits worth about ₹1.82 crore were frozen.

At Thennala Service Co-operative Bank, seven premises in Malappuram and Kozhikode linked to former office-bearers and directors were searched. They included former president M P Kunji Moideen, former secretary K A Vasudevan Moossad, former president U K Saithalavi, former directors V P Ali Hassan, N M Saithalavi, V P Raveendranath and Sajitha P.

The PMLA probe is based on 10 FIRs registered by Kottakkal Police, with around 53 other FIRs registered during 2023 and 2024 in and around Kottakkal. The bank allegedly promised higher returns on fixed deposits but failed to repay the principal and interest after maturity. The suspected proceeds of crime are around ₹10 crore.

The ED alleged that fake Kisan Credit Card and Gahan (land) loans were disbursed to non-existent persons and relatives or family members of board members, the secretary, and other officials. KCC loans were allegedly sanctioned in the names of fictitious/benami members beyond prescribed limits and without approvals, with funds diverted towards deposits, repayment of earlier liabilities and other unauthorised transactions.

“During the course of investigation under the PMLA, 2002, it was revealed that Kisan Credit Card loans were sanctioned in the names of fictitious/benami members. These loans were sanctioned beyond prescribed limits and without requisite approvals, and loan funds were diverted towards deposits, repayment of earlier liabilities and other unauthorised transactions,” the ED said.

Documents relating to two immovable properties were recovered. Freezing orders were issued against 20 fixed deposits/bank accounts containing about ₹24.50 lakh, belonging to K A Vasudevan Moossad and his wife, Rajani.

At Kuttanellur Co-operative Bank, five locations in Thrissur and nearby areas linked to its former president, secretary and other officials were searched. The probe originated from four FIRs registered by Ollur Police against Rikson Prince and others under Sections 420 and 471 of the IPC.

The ED alleged that customers’ properties were mortgaged for loans without their knowledge or consent, with loans sanctioned in third parties’ names using forged death certificates, identity documents and valuation reports. Board members allegedly granted membership to outsiders and third parties, inflated collateral valuations and forged documents to facilitate unlawful gains.

The alleged transactions caused the bank a loss of more than ₹27 crore, the ED said. Digital evidence and loan-related documents were seized. “Thus, the accused persons cheated the bank and its shareholders,” the agency said. Further investigation is in progress.