Vigilance conducts raids at KSFE chit fund outlets in Kerala, alleges major anomalies

Meanwhile, Kerala Finance Minister Thomas Isaac hit out at the VACB after it conducted the raids.
KSFE in Pallickal
KSFE in Pallickal
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The Vigilance and Anti-Corruption Bureau (VACB) conducted surprise raids on the offices of Kerala State Financial Enterprises (KFSE) Ltd, a public sector chit fund in the state, and has alleged major anomalies in its schemes and transactions. The raid was conducted to analyse KFSE’s chitty schemes. According to reports, discrepancies were allegedly detected in 20 KSFE offices across the state. The anti-corruption drive by VACB was code-named Operation Budget. However, Kerala Finance Minister Thomas Isaac hit out at VACB for its surprise raids and certain allegations. 

Some of the anomalies found by the VACB range include manipulating the bidding, drawing of lots, availing cash advances and loans on the deposits of customers and evaluating the value of title deeds as collateral for loans, among others, reports The Hindu. It also alleged that bidding and drawing of lots were in favour of some chitty fund customers. The report also added that the findings are preliminary and a forensic audit would be required to bring out more details.

Meanwhile, a Malayala Manorama report stated that VACB has found discrepancies in the gold loan sector in four offices of KSFE. The report also stated that many had been raising complaints on the alleged anomalies in the conduct of chit fund, and on drawing of the lots. The VACB conducted raids following these complaints, the report stated.

Minister Thomas Isaac slammed VACB and refuted its allegation that the firm was not depositing the money in the state treasury. The Minister said that there is no rule that KSFE should do so. The VACB cannot make law on what is right or wrong, Thomas Isaac said. 

Reacting to the Finance Minister’s criticism, the Opposition said that he was disturbed over the raids. “The raids will reveal financial fraud. He is embarrassed for that,” Leader of Opposition Ramesh Chennithala said.

However, KSFE Chairman Philipose Thomas welcomed the move. Various audits, including that of the Comptroller and Auditor General and independent audits by the firm itself, had been carried out, he said.

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