Probe into case of loan misappropriation by Ex-MLA Anvar reveals financial irregularities: ED

Malappuram(Kerala), Nov 22 (PTI) The Enforcement Directorate (ED) probing the alleged loan misappropriation by former MLA P V Anvar from Kerala Financial Corporation (KFC) said on Saturday that it has unearthed financial irregularities linked to the political leader’s business dealings.

ED has carried out raids on the residences and businesses of Anvar here on Friday.

The ED is probing about the Rs 7.5 crore loan, the KFC had granted to Malamkulam Constructions in 2015.

Later, loans to the tune of Rs 3.05 crore and Rs 1.56 crore were sanctioned to Pee Vee Aar Developers, using the same collateral properties within a short interval, resulting in a total NPA of approximately Rs. 22.3 Crore, a statement from ED said.

As many as 15 bank accounts held in the names of different persons, alleged to be benamis, from which suspected transactions have taken place, were identified, the statement said.

The seized materials are being examined to identify the Proceeds of Crime, quantify the diversion of loan funds, establish the layering mechanism and determine the extent of benami holdings.

According to ED, preliminary evidence indicates diversion of the sanctioned funds, use of nominal shareholders and directors, and suspected benami ownership of assets.

"During the searches, Anvar admitted to being the real beneficial owner of Malamkulam Constructions, despite the company being held in the names of his nephews and driver. He confirmed that loan amounts were used for the large township project Pee Vee Aar (PVR) Metro Village," ED said.

According to ED, the statements of his associates revealed that documents were routinely signed at his instruction, funds were diverted to associated entities, and certain cash collections were handled outside regular accounting channels.

It is also found that certain buildings were constructed in PVR Metro Village by Malamkulam Constructions Pvt Ltd without proper approvals from the local regulatory body, and Proceeds of Crime have been infused in the said construction, ED said.

ED officials said that searches at the premises of Bis Manjeri LLP and PVR Metro Village indicated extensive construction and commercial activity, including schools, amusement parks, resorts, villa projects, and apartment blocks.

“Evidence collected suggests transfer of loan proceeds between related entities and utilisation for purposes unrelated to sanctioned activities. During the searches, various incriminating documents and digital evidence related to sale agreements, financial documents and property papers, multiple records and digital devices, have been seized," ED said.

According to ED, statements of KFC officials recorded during the operation revealed procedural lapses, non-verification of prior mortgages, and re-use of the same collateral for subsequent loans.

"The Technical Officer admitted that valuation reports were reused without fresh inspection, and the legal officer acknowledged that earlier encumbrances went undetected," the statement by ED said.

ED initiated the investigation after the Kerala Vigilance and Anti-Corruption Bureau (VACB) recently registered a corruption case related to loan misappropriation at the KFC Malappuram office.

Last month, the ED recorded the statement of Murugesh Narendran, the complainant in the VACB case.

Anvar, a former MLA from Nilambur, parted ways with the LDF following differences and later contested the Assembly by-election on an All India Trinamool Congress ticket early this year. PTI TBA TBA ADB