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Kerala: Loan fraudsters mint crores from Karuvannur bank’s supermarkets

Irregularities worth C1.7 cr found in stocks of supermarkets during 2019-20 fiscal alone

Published: 26th July 2021 02:37 AM  |   Last Updated: 26th July 2021 02:37 AM   |  A+A-

fraud, loan fraud

Representational image (File photo | AP)

Express News Service

THIRUVANANTHAPURAM: The employees of Karuvannur Service Cooperative Bank who committed a loan fraud of Rs 300 crore had also used the three supermarkets and Rubco wholesale dealership managed by the bank for expanding their personal businesses. Irregularities worth Rs 1.7 crore were found in the stocks of supermarkets during the 2019-20 financial year alone. In the Rubco agency, misappropriation worth Rs 50 lakh was found in the audit of the same period. 

The bank has three supermarkets at Mapranam, Karuvannur and Moorkhanad. From the launch of operations till October 1, 2019, C K Jills was in charge of managing the supermarkets. Jills is an accused along with bank secretary T R Sunilkumar, former manager M K Biju and collection agent C K Bijoy in the loan fraud. A new employee, Sandeep, was given charge of the supermarkets on October 1. The manipulation in shops came to the notice of Sandeep during the audit in March, 2020. 

He had checked previous years’ statements given to auditor and found that the original stock audit report and the one submitted to audit were different. Jills purposely tried to cover up the manipulation by forging fake reports which were approved by auditors in previous years. 

Though there was a purchase committee that included directors of the bank, purchases for the supermarkets were directly controlled by Jills. The major supplier of grocery items to the supermarkets was an agency named Benefit Premium packing. Sreelatha, wife of Jills; Jitha, wife of manager M K Biju, and Rahim, brother-in-law of Biju, were the directors of Benefit Premium packing. 

Ignoring all norms and the element of conflict of interest, purchases worth crores of rupees were done from the agency owned by the close relatives of the cartel of employees who are now accused in the banking fraud. Another vendor for the supermarkets was Crangannur Enterprises owned by Rahim and that agency too was given orders worth crores. 

The activities of Jills and other members came before the director board of the bank as a complaint in August, 2020. Following this, the director board suspended Jills on August 24, 2020, pending inquiry. However, no action was taken against other employees who had aided him to commit fraud.  The Karuvannur bank bagged the wholesale dealership for Rubco furniture and mattresses for Thrissur district in 2001. Biju was given the charge of the agency and he had continued in the post till 2019. C K Bijoy, who later joined the gang of Biju and Jills, was hired by Biju as a commission agent for Rubco agency in 2003. When Biju handed over the charge of the agency to another employee, Sreedevi, in 2019, proper stock registers were not handed over. 

Sreedevi had testified before the Cooperation Department inquiry panel led by assistant registrar Omana K L that original stock position was not transferred to her by classifying the stock as damaged stock, dead stock and remaking stock. The auditor who conducted routine annual auditing of the bank in 2018-19 couldn’t audit the Rubco agency as Biju failed to submit records on time. The audit team led by Omana found that Rs 48 lakh was missing from the Bank’s agency as per the statements of retail agencies which took stock from there.



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