Hyderabad: ED searches Karvy CMD C Parthasarathy’s house, offices

HYDERABAD: The Enforcement Directorate on Wednesday conducted searches at six locations in Hyderabad in connection with Karvy stock broking scam.
Searches were carried out at the residence of Karvy Stock Broking Limited chairman and managing director C Parthasarathy and offices of Karvy. The ED earlier recorded the statement of Parthasarathy. The ED was verifying the destination and route of crime proceeds amounting to hundreds of crores in the scam.

The ED had booked a case under the Prevention of Money Laundering Act based on the FIRs issued by Hyderabad Central Crime Station.CCS had registered four cases so far against Karvy for cheating IndusInd Bank and HDFC Bank for loan fraud and clients for diverting their stocks and money.
In one of the cases, IndusInd Bank accused Karvy management of availing credit facility of Rs 137 crore by pledging securities. Parthasarathy suppressed the fact that the pledged securities belong to the clients without their consent and misused power of attorney. The securities of clients were later transferred to the demat account of Karvy company and pledged to IndusInd Bank.
Karvy turned into a defaulter and also diverted funds into its own and sister companies.
In another case, HDFC Bank was duped to the tune of Rs 350 crore.
A case was registered on September 8 with Sheshadripuram police station in Bengaluru under IPC sections of cheating, criminal conspiracy and forgery against Parathasarty and others. Bengaluru Central Crime Branch(Organised Crime Branch) is investigating the case.
Parthasarathy is director of Karvy Reality (India) Private Ltd to which the complainant had transferred Rs 109 crore. Parthasarathy is also accused in a cheating case of Rs 25 lakh in Barnala of Punjab.