TN school recognition scam: How a safety mechanism was turned into a money making scheme

Behind the gates of a rented bungalow in south Chennai, an unassuming education supply company called Global 360 Edu Care operated for years as a vendor of textbooks, bags, and uniforms. Investigators now believe the property served as the front office of a massive, state-wide cash-for-clearances scam run during the Dravida Munnetra Kazhagam (DMK) regime that targeted private school managements who were desperate for recognition and various kinds of approval. 

Several private school owners, while speaking to TNM, however alleged that though the money changed hands, the promises were not kept and they felt cheated.

Chennai Police’s Central Crime Branch (CCB) officials said private school administrators across Tamil Nadu were routinely coerced into paying large sums disguised as "party funds" to obtain statutory approvals. The investigation is centred around an alleged network involving former school education minister Anbil Mahesh Poyyamozhi, DMK spokesperson BT Arasakumar and former DMDK MLA Muthukumar.

More than 750 schools from various districts of Tamil Nadu could have paid bribes for upgrades, permanent recognition, and approvals from the Directorate of Town and Country Planning (DTCP), and the Chennai Metropolitan Development Authority (CMDA), according to investigators.

But so far only 177 school managements across the state have lodged complaints against BT Arasakumar and Muthukumar for cheating them. An estimated bribe amount of around Rs100 crore has been collected, investigators said.

The CCB officials are now investigating the links between the money collected as bribes from private school managements by corroborating the official records and government orders issued in favour of private schools. 

The investigation points to two parallel channels through which private schools were allegedly drawn into the cash-for-clearances network. BT Arasakumar used the newly formed Tamil Nadu Private Schools Association (TNPSA) as an organisational platform, approaching school managements through a government backed association that promised to resolve their recognition and approval problems. 

Muthukumar, meanwhile, allegedly operated through his position in the government’s Parents Teachers Association. Though their routes were different, investigators allege that they colluded and served one purpose: extracting money from schools.

The corruption allegations raise the larger issue of compromising the quality of the education and the safety of school children as several promised approvals were related to structural safety of the buildings. It also shows that school managements, government officials and politicians were willing to accord such sanctions through dubious means.

The Kumbakonam school fire tragedy of 2004, which killed 94 children, forced the Tamil Nadu government to tighten its rules and regulations governing the recognition of private schools in the state. Mandatory structural stability certificates, fire safety clearances, sanitary certificates and building licences became critical requirements for schools seeking recognition and its renewal.

Two decades later, the system created to ensure that schools comply with safety regulations was exploited, investigators said. TNM spoke to several school administrators who alleged they handed over lakhs of rupees. 

The Global 360 Educare connection

Global 360 Educare is a proprietorship firm that publicly describes itself as a provider of affordable school products such as books, uniforms and bags.  

According to GST records seen by TNM, Global 360 Educare is a proprietorship owned by former DMDK MLA V Muthukumar, and, allegedly, a close associate of Anbil Mahesh.

Speaking to TNM, KR Nandhakumar, secretary of the Tamil Nadu Nursery, Primary, Matric, Higher Secondary and CBSE Schools Association, which had joined TNPSA, said that he too was a victim of the scam. “I visited the Global 360 Edu Care office and paid 27 lakhs directly to Muthukumar for the CBSE no-objection certificate for my school. This company was used as a front office to collect money from various school managements in return for mandatory clearances,” he alleged.

Nandhakumar has recorded his witness statement under section 183 of Bharatiya Nagrik Suraksha Sanitha (BNNS) in the presence of a judicial magistrate. 

“All school-related files would first go to this private office and after formalities it will move to government officials for further action. Without paying bribes no school would get any clearance,” Nandhakumar alleged.

Senthil Kannan, an educational activist from Madurai alleged, “Global 360 Edu Care was the office from where all these mandatory clearances for schools were facilitated.”

A lookout notice has been issued and special teams have been formed to secure Muthukumar's arrest even as he continues to evade the law. Muthukumar approached the Madras High Court twice seeking anticipatory bail but the petitions were dismissed.

Muthukumar, DMDK’s former Virudhachalam MLA, was elected to Tamil Nadu government’s State Parents Teachers Association (PTA) as vice-president in November 2023, while minister Anbil Mahesh was its president.

Investigators said Muthukumar’s PTA office, located in the Directorate of Public Instructions (DPI) campus in Nungambakkam Chennai, was also used to collect bribe money. The CCB has obtained statements from school authorities that some of them have met Muthukumar at the PTA office and handed over the money.

The demand for money in return for approvals hit small-scale institutions the hardest, with many operators forced into severe personal debt just to keep them running.

“Most people who lost their money in this scam own nursery schools,” an owner of a nursery school told TNM, adding that he had to pledge his wife’s jewellery to pay Arasakumar just to upgrade his nursery school to a primary school.

 “Around 3500 vulnerable schools were identified and were asked to attend meetings organised by Arasakumar and Muthukumar in their respective districts like Hosur, Dharmapuri and Madurai to create a process for paying money and obtaining clearances,” he alleged. 

Senthil Kannan alleged that some office bearers of private school associations have also played a role in persuading school managements to pay bribes to seek mandatory clearances and their role has not come under the scanner. 

When TNM visited the Global 360 Educare office in T Nagar, it had moved to a different location. When TNM contacted the listed number, we were told that it was published incorrectly.

Private school regulations

Private schools in Tamil Nadu are governed by the Tamil Nadu Recognised Private Schools (Regulation) Act, 1973, TN Private Schools (Regulation) Act 2018 and Tamil Nadu Private School (Regulation) Rules, 2023. The basic purpose of this Act is to regulate the establishment, recognition, administration, student safety and functioning of private schools in the state.

Following the Kumbakonam fire tragedy, the Tamil Nadu government decided to ensure the safety and security of students by tightening the conditions under which private schools could obtain and retain recognition.

A regulatory framework was developed which required school managements to obtain statutory clearances once in three years, such as building licences, structural stability certificates, sanitary and hygiene certificates, and No-Objection Certificates from the Fire and Rescue Department.

School recognition is meant to establish whether a school has proper infrastructure while building approval like DCTP, CMDA clearances to ensure that the land is used for a specific purpose. The fire safety NOC ensures the safety of school children and teachers, and structural and sanitary certifications are to maintain hygiene on the premises.

For school managements, this may look like a bureaucratic maze, but this was designed as a safety net to keep different departments in the loop before a school is allowed to operate and expand its base.

However, this also created an opportunity for intermediaries to exploit the situation and indulge in corrupt practices.

Launch of TNPSA

There were several school associations involved in voicing the concerns of private school managements and fighting legal battles in Tamil Nadu. 

Arasakumar, who ran the All India Private Educational Institutions Association (AIPEIA), a body registered in 2003, had been campaigning for permanent recognition for schools. In 2019, the AIPEIA approached the Madras High Court challenging the system of temporary recognition and argued that schools that have fulfilled all the requirements should be granted permanent recognition.

An office bearer of a private school association recalled that BT Arasakumar told them that instead of representing their interests separately to the government, forming a single organisation, backed by the state government, would help them get their demands addressed. 

“BT Arasakumar persuaded them to create a single platform and that's how Tamil Nadu Private Schools Association was born,” he said.

​Formed in December 2024, the association united six groups: The All India Private Educational Institution Association led by BT Arasakumar himself, Tamil Nadu Nursery Primary Matric Higher Secondary and CBSE Schools Association, All India Private Schools Association, Federation of Private Schools Association, Federation of Association of Private Schools in Tamil Nadu and Tamil Nadu Correspondents Association of Private Schools. 

The TNPSA was launched on December 30, 2024, at Kalaivanar Arangam in Chennai. It was inaugurated by education minister Anbil Mahesh Poyyamozhi. 

Senthil Kannan, who attended the inaugural event said Anbil Mahesh requested school managements to reach out to Arasakumar and Muthukumar to get their issues resolved. “This empowered them to indulge in this massive scandal,” he alleged. 

The police have obtained the video recording of the speech by minister Anbil Mahesh during the event.

Boopathy, the Correspondent (school administrator) of Sri Maha Matriculation Higher Secondary in Madurai, had attended the event and said it spurred him into paying the bribe.

“I paid Rs 25 lakh to BT Arasakumar in 2025 during his visit to Madurai to secure permanent recognition and for a DTCP approval for my school and I have been cheated,” said Boopathy. “We know giving bribes is unacceptable, but we were forced to pay to secure mandatory clearances” Boopathy’s school however did not get the recognition. 

Boopathy told TNM that in Madurai only five schools were ready to lodge complaints. “Not everyone is willing to come forward,” he said.

A school correspondent from a southern district in Tamil Nadu told TNM that just before the 2026 Tamil Nadu assembly elections he paid Rs.5 lakh for upgradation to BT Arasakumar despite knowing that nothing was going to happen. 

Though Arasakumar was elected the president of the new association, some private school associations kept their distance. 

MJ Martin, state president of School Voice, an association of private schools in Tamil Nadu, told TNM that they were approached by middlemen to join the government-backed organisation, but they chose to stay away. 

“We refused because their primary demand was to dissolve our organisation. We also had doubts about the approach and process,” Martin said. 

The complaint against Arasakumar and Muthukumar was lodged by DC Elangovan, the state general secretary of Federation of Association of Private Schools in Tamil Nadu, which had become part of the TNPSA. 

Documents seen by TNM, submitted to CCB, list the amounts allegedly paid to Arasakumar and Muthukumar by school managements. The police are trying to establish the money trail. 

A school correspondent told TNM that the bribe amount depends on the size and scale of the school. “If it is around 500 students an amount of Rs five lakh to Rs seven lakh will be collected for permanent recognition and the amount goes up as the student strength increases. The amount could go up to Rs 25 lakh,” she alleged. 

According to the list submitted to CCB officials, three schools in Cuddalore district allegedly made payments for approvals. A private school management in Cuddalore district paid ₹16 lakh for permanent recognition, while another school in Kurinjipadi paid ₹7 lakh for permanent recognition. A school in Parangipettai paid ₹5.50 lakh for DTCP approval.

The permanent recognition flip-flop

From the 1970s, recognition for private schools were granted on a temporary basis for three years and renewals would take place once in three years, after fulfilling the prescribed requirements as per law.

In September 1994, the Tamil Nadu government issued orders (G.O (Ms) No.752) to grant permanent recognition for deserving schools of all categories, which have been running with recognition for more than ten years and have followed all the required norms. 

On November 12, 2021, the DMK government withdrew the G.O, which empowered the School Education Department to grant permanent recognition. The decision was based on a letter written by the Director of Matriculation Schools, citing the Kumbakonam school fire mishap of 2004. 

“After careful examination the government order granting permanent recognition is withdrawn and recognition shall be granted to all private schools for a period of three years or for the period specified in the structural stability certificate or building licence whichever is earlier and which shall be renewed periodically,” read the new government order.

In March 2026, just before the Tamil Nadu Assembly elections, the School Education Department amended the Tamil Nadu Private Schools (Regulation) Rules, 2023. Under the updated sub-clause, a school's certificate of recognition is now issued for the duration specified in its structural stability certificate, its building license, or a maximum period of 20 years, whichever is shortest.

The government subsequently directed officials to inspect schools and process applications for extended recognition, with schools that had operated without violations for three consecutive years becoming eligible for 20-year recognition, while fire-safety, structural-stability and sanitation certificates would still have to be produced periodically. 

Out of 14,000 private schools, only 70 had permanent recognition.

ED initiates money laundering probe 

While Muthukumar continues to evade arrest, Arasakumar was arrested by the CCB in June 2026. He was charged with forcefully collecting money from private schools by promising to secure government approvals through his political and bureaucratic contacts and was detained under the Goondas Act.

While opposing the bail petition of Arasakumar, the Special Public Prosecutor informed the court that Arasakumar extorted money and cheated multiple school managements. “There are over 3,500 private schools operating across the state of Tamil Nadu.Taking advantage of their regulatory vulnerabilities, the petitioner floated an unauthorised association to systematically extort and cheat multiple school managements,” said a bail rejection order dated July 15, 2026.

Two of his relatives, Arockiaraj from Madurai and Suresh from Trichy, have also been arrested. According to the police, they had no connection with the school education department, but were involved in allegedly collecting money from school managements on behalf of him. 

According to sources, a key witness has submitted video recordings and documents related to money transactions that took place at Global 360 Edu Care office and has allegedly named the former minister. 

Anbil Mahesh has approached the Madras High Court seeking to quash the FIR registered against him. Interestingly, the DMK has cited the absence of the Governor’s approval for registering an FIR against him. 

Anbil Mahesh in his anticipatory bail application claims that the complainant in the case, DC Elangovan, had some misgivings with BT Arasakumar and hence a complaint was lodged and FIR was registered in this case. “

Prima facie, from the reading of the FIR, it can be seen that the allegations are largely that BT Arasakumar and his team of office bearers in the team of TNPSA made tall promises to the member schools and collected money and were not able to fulfill their promises. When the FIR was registered there were no allegations that any bribe money was paid to the petitioner (Anbil Mahesh) or any other public servant," said the anticipatory bail application of Anbil Mahesh. 

While assuring that he is fully cooperating with the investigations, Anbil Mahesh has also submitted his Income-Tax returns. I-T returns of his wife Janani and mother-in-law for the past 10 years, as required by the CCB officials, have also been submitted.

The Enforcement Directorate (ED) has registered an ECIR, an internal document to initiate investigation, and is probing the angle of money laundering.