Reddy probe: Gold worth Rs 2 cr seized
Johnson T AJanardhan Reddy, Karnataka Lokayukta, bellaryPosted: Sun Sep 18 2011, 03:21 hrsBangalore:
CBI investigations into the illegal mining activities of former Karnataka minister and mining businessman G Janardhan Reddy and his associates, described as a mining mafia by a July 27 report of the Karnataka Lokayukta, reached the banks in Bellary on Saturday.
The CBI, which has been holding Janardhan Reddy and his relative B V Srinivas Reddy in custody for interrogation, brought the latter to Bellary today to physically examine lockers at an Axis Bank branch. The bank is one of many where the mining group is known to have held multiple accounts.
According to reports,the CBI team seized gold jewellery worth about Rs 2 crore from the bank lockers. Srinivasa Reddy reportedly has six lockers in the private bank, of which four have so far been opened.
According to the findings of the Karnataka Lokayukta report, a group of people now identified as being part of an iron ore smuggling syndicate, with Janardhan Reddy being part of it, opened as many as 60 bank accounts across Karnataka between 2008-09 and 2009-10 — when the Reddy brothers gained political clout as ministers in the BJP government in Karnataka.
Most of the accounts were held in the name of benamis to receive the proceeds of illegally exported ore and to pay kickbacks to the racket’s facilitators.
“On verification of the transactions in these accounts it is noted that there are close linkages between the illegal mining and transactions. Most of these accounts are opened in the 2008-09 and also 2009-10. The movement of money was varying during 2009-10 when the illegal mining activities were at their peak. Further investigation is required in this matter,’’ the Lokayukta report had noted.
Srinivas Reddy a director in Janardhan Reddy’s Obulapuram Mining Corporation, held one of his several accounts at the Axis Bank, Bellary in the name of a front company called Sree Minerals that, according to the report, was supplying stolen iron ore to OMC.
According to the report, a maze of bank accounts and transactions were created by the Bellary mining mafia in an effort to throw investigators off-track in case of a probe. While money came in fast into the multiple accounts between 2008 and 2010, they were also removed with equal speed, mostly as cash through self cheques, in the names of hundreds of people believed to be benamis.
“All this clearly indicates complex inter-linkages with regard to the role of a group of persons closely related and associated in this illegal and unlawful mining activities,’’ said the Lokayukta report.
Among the multiple bank accounts that were used to channel back funds from the illegal exports of iron ore are two accounts held by a firm Sri Bhaktha Markandeshwara Minerals (SBMM) that was established in 2008. Found to be the front company of K Mahesh, an associate of Janardhan Reddy, SBMM opened one account in the Axis Bank at Bellary in November 2009. The account tallied a total of Rs 37.19 crore debits and equal credits till January 29 this year.
The Lokayukta in its report has recommended that offences be booked against banks as well for allowing the subversion of their system.
— With PTI inputs
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