Kerala’s Minister for Cooperation, V N Vasavan, announced on Tuesday that the state government is taking decisive legal action to recover documents seized by the Enforcement Directorate (ED) from the Karuvannur Cooperative Bank. This seizure is part of the investigation into a massive Rs 300 crore scam that rocked the institution.
Speaking to the media after a meeting convened to address the crisis in the cooperative bank, Minister Vasavan assured depositors that their funds would be reimbursed expeditiously. He stated, “The ED has seized 162 land documents valued at Rs 184.62 crore and other documents from the bank. This has made it difficult to accept loan repayments. Legal measures will be initiated to get back the documents.”
Furthermore, Vasavan emphasized that the state government and the cooperation department had swiftly taken rigorous measures once the financial irregularities in the bank came to light. “As many as 18 cases were registered, and investigations by the Vigilance and Anti-Corruption bureau, as well as a special probe by a nine-member team, were initiated,” he confirmed.
In terms of repayment to depositors, the minister noted that Rs 73 crore had already been disbursed in accordance with a prior package, and the remaining sums would be returned promptly. He explained, “As part of the new package, Rs 50.75 crore will be raised and paid to the depositors. The fund will be raised by collecting the amount which could be withdrawn from Kerala Bank, the amount due from Consumerfed and Cooperative Hospitals, amount that could be raised from cooperative societies as per existing permission, amount that could be received from fund board as well as the fresh funds to be raised by primary cooperative societies.” The collected amount will be distributed to permanent investors and savings investors.
To address the crisis at the Karuvannur bank, an experienced official from Kerala Bank will be appointed as the chief executive, and arbitration recovery procedures will be bolstered, Vasavan declared.
He also expressed confidence that efforts to tarnish the cooperative sector would not succeed, stating that all banks facing crises could be rescued with the Cooperative Protection Fund.
The meeting at Ernakulam Guest House was attended by prominent figures including Kerala Bank President Gopi Kottamurickal, Cooperation Department Secretary Mini Antony, Registrar T V Subhash, Kerala Bank CEO P S Rajan, Executive Director K C Sahadevan, cooperative department officials, and members of the Karuvannur Bank Administrative Committee.
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