Comandur Parthasarathy, the chairman and managing director of Karvy Stock Broking Limited (KSBL), was arrested by the Enforcement Directorate (ED) on Sunday, in connection with a bank fraud case, is likely to be questioned in police custody.
The agency has got five-day custody of the alleged accused. Parthasarathy is currently lodged in Chanchalguda jail from where he will be taken into custody. He was lodged with Bengaluru jail and shifted to Chandhalguda jail on a prisoner transit warrant.
Initially, the Hyderabad Central Crime Station (CCS) Police lodged a case against him. The Hyderabad Police lodged five cases against the firm. Indusind Bank and HDFC Bank had alleged that the KSBL committed loan fraud by pledging the securities of its client and diverting the loan amount.
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The ED initiated a money-laundering probe on the basis of the FIRs of Hyderabad Police.
The Hyderabad CCS Police had filed a charge sheet in the matter. The ED after initiating a PMLA probe, took a copy of the charge sheet and other relevant documents to probe the money laundering case. The ED also took reports of Income-Tax, RBI, SEBI, and NSE to make their case a strong one.
It has been alleged that the KSBL management allegedly committed bank frauds of several hundreds of crores of rupees.
KSBL reportedly transferred Rs 550 crore to several accounts.
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Indusind Bank gave a loan of Rs 137 crore to KSBL on the basis of securities, shares, and personal guarantees. One of the guarantors was the chairman of KSBL, C Parthasarathy. They suppressed the fact that the pledges securities belonged to customers.
All the securities were transferred to the Demat account of KSBL and pledged before the IndusInd bank for margin and short-term requirements in their businesses.
HDFC Bank has also alleged that KSBL took a loan of Rs 329 crore by illegally pledging the securities of their clients. Later they transferred the case.
ED also learned during the probe that between 2016 and 2019 KSBL allegedly transferred Rs 1,000 crore to Karvy Realty company.
In September last year, the ED had conducted raids at different addresses belonging to KSBL. The ED had also frozen shares of Karvy Group.
The ED has gathered a lot of incriminating documents and probed the matter.
