ED arrests former MP Kuldeep Rai Sharma in ₹500 crore Andaman bank fraud case

This marks the first-ever arrest made by the ED under the anti-money laundering law in the Union Territory of Andaman and Nicobar Islands.

A special Prevention of Money Laundering Act (PMLA) court in Kolkata has sent Sharma and Kalaivanan to eight days in ED custody, it said.

Murugan was not produced before the court as he was admitted to a hospital, officials said.

The ED investigation began after an FIR was filed by the Andaman & Nicobar Police.

It had conducted searches at 21 locations on July 31 and August 1 and further searches are currently underway at three additional premises in the Andaman & Nicobar Islands.

According to the ED, the accused allegedly floated several shell companies and sanctioned large loans to them and their regular entities, violating bank protocols.

The ED probe found that approximately Rs 230 crore was fraudulently taken for the benefit of Sharma and his associates. Murugan and Kalaivanan allegedly availed loans from the bank in the names of companies incorporated in the names of their relatives and received a five percent commission on loans they helped their associates get, as instructed by Sharma.

These commissions were paid either in the form of “cash” or through shell company accounts, the agency said.

The fraudulent loans, which exceed rupees 500 crore, have been classified as non-performing assets (NPA).

— WITH PTI Inputs