Kasaragod: Manjeshwaram MLA M C Kamaruddin of the Indian Union Muslim League (IUML) has been arrested over an investment fraud. 

The arrest was registered on Saturday based on complaints from those who invested money in a jewellery chain in Kasaragod - Fashion Gold International - in which Kamaruddin is the chairman. "We have secured enough evidence to arrest him," ASP Vivek Kumar said a little while before arresting Kamaruddin on Saturday.

The investors had claimed that Kamaruddin and jewellery director Pookoya Thangal, who is also a leader of the Indian Union Muslim League (IUML), cheated them of more than Rs 100 crore.

They were booked under Section 420 (cheating) of the Indian Penal Code after over two dozen complaints were received in the Chandera and the Kasaragod police stations.

The money was collected from 800 people to set up the jewellery chain. They were promised of a monthly dividend from the company's profit.

The investors regularly received dividends till last year. They filed police complaints when they failed to get the payment.

The IUML had asked Kamaruddin to settle the dues. The party said it had nothing to do with Kamaruddin's financial dealings.

In the wake of police complaints, the United Democratic Front (UDF) had removed Kamaruddin as its district chairman.

Kamaruddin was elected to the assembly from Manjeswaram constituency in Kasaragod district in the bypoll held in October last year.

Was made a scapegoat: MLA

In his first reaction after the arrest, Kamaruddin told media that he was being made a scapegoat by the CPM-led government in a bid to cover its own crimes. Terming the police action politically motivated, the MLA said he was not served a notice prior to the arrest. He said the police did not wait till Monday when the high court is scheduled to hear a case relating to the allegations.

He was speaking to media while being taken to a hospital for medical tests ahead of being produced before the Hozdurg magistrate.

UDF convener M M Hassan also said that the case against Kamaruddin was politically motivated. Meanwhile, KPCC president Mullappally Ramachandran said that the law should take its course.

To file bail plea

Kamaruddin's lawyer Vinod Kumar said the MLA would file a bail plea. He said the charges of cheating will not stand the scrutiny of the law.

The charges against Kamaruddin, if proven, may invite imprisonment up to seven years.