THIRUVANANTHAPURAM: The Enforcement Directorate (ED) on Friday conducted a search at the Nemom Service Cooperative Bank, where irregularities worth Rs 97 crore were allegedly detected earlier this year. Officials from the ED’s Kochi office took part in the proceedings.
The bank, which was governed by a CPM-led panel, has been at the centre of controversy, and the ED’s intervention has acquired political overtones as it comes just ahead of the local body elections in the state.
The controversy began after the bank failed to repay several depositors, prompting an inquiry by the Cooperative Department. The probe revealed widespread irregularities and mismanagement, resulting in losses amounting to several crores of rupees.
The Crime Branch, which investigated the case, had arrested three individuals, including the bank’s president and secretary. The Cooperative Department’s report indicated that the bank has outstanding dues of about Rs 35 crore, but only half of that amount can likely be recovered through legal means.
Officials had allegedly failed to record the names and details of all depositors in the official documents. It was also found that bad loans had surged beyond feasible limits, and the properties and valuables pledged as security were insufficient to cover the losses.
For the past three months, the bank has been under the control of an administrator. In addition to the bank premises, the ED also carried out searches at the residences of the board members, sources said.
With the local body polls around the corner, the development could pose a political headache for the CPM. The CPM-led LDF is aiming to retain power in the Thiruvananthapuram Corporation, while the BJP has been making efforts to wrest control from the Left.