'If I had not pledged my body for medical education I would have ended my life'

Thrissur: On July 22, 2021, former member of erstwhile Porathissery grama panchayat T M Mukundan (63) ended his life after being harassed by the CPM-controlled Karuvannur Service Cooperative Bank to return the loan he never borrowed.

Mukundan, a Congress member, had taken a loan of Rs 30 lakh. But in the foreclosure notice sent to him in February 2021, the bank said he had taken two loans worth Rs 30 lakh and Rs 50 lakh. He protested saying he did not take the second loan but the bank did not budge. He took the extreme step fearing losing his home and property.

On July 14, 2021, eight days before his death, the secretary in charge of the cooperative bank, Sreekala, filed a complaint with Irinjalakkuda Police accusing a clique of employees of swindling Rs 100 crore from the bank. In her complaint she alleged, the employees re-pledging the properties of the bank's borrowers without their knowledge and gave loans to third parties. The accused named by the secretary in-charge were the bank's secretary Sunil Kumar T R and manager Biju M Kareem, senior accountant Jilse C K, bank member, agent Kiran P P, commission agent Bijoy and society's supermarket accountant Reji Ani.

They flouted rules and gave more than one loan to the same person, gave membership to persons outside the jurisdiction of the bank by using fake address proofs, messed up the bank's software, and siphoned around Rs 1.5 crore from the cooperative society's supermarket at Karuvannur, she alleged and estimated the multi-pronged scam at Rs 100 crore.

On July 21, 2021, a day before Mukundan died by suicide, the Kerala State Police's Crime Branch took over the investigation into the scam. Even then, the LDF government and the CPM tried to hush up the affair, said M V Suresh, a former manager of Karuvannur bank and long-time complainant. "If the going-ons in the bank were made public when the scam was reported in 2018 and 2019, Mukundan's life could have been saved," he said.

To be sure, the Department of Cooperation initiated an inquiry into Karuvannur bank in August 2019 when several borrowers received foreclosure notices for loans they did not take.

The department's Assistant Registrar Omana K L, Inspectors Resmi P C, and Preetha V V completed the inquiry and submitted a damning report on October 10, 2020. The government sat on it for nine months, Suresh said.

On July 22, 2021, the day Mukundan died, the government applied a band-aid by disbanding the cooperative society's board of directors and deputed an administrator (Assistant Registrar M C Ajith) to run it.

Around the same time, the Union government's Enforcement Directorate (ED), which investigates money laundering cases, recorded a case and began an investigation into Karuvannur bank. After two years, it unearthed a bigger "organised crime", allegedly involving politicians, police officers, and officials in the local, district, and state administration. The crime involved several cooperative banks in Thrissur but was perpetrated allegedly by the same set of players.

In September 2023, the ED arrested private financier Satheesh Kumar P, Karuvannur bank member Kiran P P, senior accountant Jilse C K (45), and CPM leader and councillor of Wadakkancherry municipality Aravindakshan P R (57). The scam has now ballooned to around Rs 400 crore.

Dept sought to recover Rs 113 cr from directors, officials
In August 2022, the Department of Cooperation's Joint Registrar of Thrissur submitted a report to the government saying the scam in Karuvannur bank was perpetrated in two terms: 2011 to 2016 and 2016 to 2021.

The report estimated that liability to the bank because of illegal practices stood at Rs 112.87 crore. It said the money should be recovered from the 20 directors who served during the two terms and the three officials -- secretary Sunil Kumar T R, manager Biju M Kareem, and accountant Jilse C K -- who allegedly perpetrated the crime.

The report estimated the recovery of Rs 2.20 crore from each director who was on the board from 2011 to 2016; Rs 5.33 crore from those who were directors from 2016 to 2021; and Rs 7.53 crore from the directors who served both terms.

The society's president and CPM leader K K Divakaran and secretary Sunil Kumar were slapped with a liability of Rs 7.53 crore. Manager Biju M K was slapped with a liability of Rs 9.17 crore and accountant Jilse C K was slapped with a liability of Rs 14.45 lakh.

A director's cut
E C Antu (pronounced Anto), a house painter by profession, was shattered when he received a recovery notice for Rs 2.20 crore from the bank. Now, the outstanding against him has surged to Rs 3 crore.

Antu (63) served as Karuvannur bank's director for two terms: from 2006 to 2011 and from 2011 to 2016. "I have not taken a single penny from the bank, illegally," he said. On the contrary, the nearly Rs 10 lakh he deposited in the bank's two chit funds is stuck there.

He said he contemplated taking the path taken by Mukundan. "If I had not pledged my body for medical education, I would have also ended my life," said Antu. He had fulfilled all the procedures set by the church to donate his body to Thrissur Medical College.

Three months ago, Antu and his family and grandchildren left their own house at Moorkanad and shifted to a rented house at Perumbillissery in Thrissur's Irinjalikkuda town. "Though there is a court stay, the department officials were out to take everything from our furniture to the TV set," he said, explaining why he moved out of his house.

The rental agreement for the house was signed by his daughter-in-law. "So they cannot come here," he said in all innocence.

The situation of Sugathan K V (58), a security guard, is worse than Antu. He was the director of the bank from 2011 to 2016 and from 2016 to 2021. The department sent him a recovery notice for Rs 7.53 crore. It has now grown to around Rs 10.5 crore. Sugathan does not even own a plot or a house.

'CPM runs the show, not board of directors'
From the outside, the board of directors of a cooperative society looks powerful. But inside, the party takes all the decisions, Antu said. "We just sign the dotted lines," he said.

The CPM has deputed the party's District Secretariat Member C K Chandran, a leader close to CPM's state committee member and former Minister for Cooperation A C Moideen; secretaries of two CPM local committees A R Peethambaran and M P Raju, bank president K K Divakaran, secretary (who was then Sunil Kumar T R) and the board director from Porathissery ward, said Antu. "Every policy decision is placed before that committee and cleared," he said.

The party places political lightweights on the board so that there is no resistance to the decisions taken by the committee.

In Antu's case, he was the Congress candidate in the 2005 local body election from Porathissery. But on the last day of withdrawal, the party asked him to back off from the election and backed another candidate. This miffed him. "I did not withdraw my nomination. But I did not lose my deposit either," he said.

Soon afterwards, the CPM contacted him and made him a director of the bank, and then gave him membership to the party, too. In hindsight, he was walking into a trap.

Karuvannur Service Cooperative Bank, which completed 100 years in 2021, is a super-grade bank. As per government rule, there should be a permanent auditor in the bank. "We had one and his salary was paid. Yet, he did not flag the scam," Antu said.

'They destroyed the bank and the town'
In 2014-2015, the bank had a deposit of Rs 274 crore. It jumped to Rs 402 crore in 2018-19. But the same year, the bank slipped into red with a loss of Rs 13.73 crore. The following year, that is in 2019-2020, the bank's deposits dipped to Rs 350 crore and the loss widened to Rs 28.40 crore. Perhaps, the alert depositors got the wind of the scam and stayed away. In its centenary year of 2020-21, the bank plummeted to a loss of Rs 51.27 crore.

In July 2021, after Mukundan's death, many of the 11,000 depositors of Karuvannur bank came to know of the police complaint filed by the secretary in charge Sreekala and rushed to the bank to withdraw their money. The bank initially stopped disbursing money and then imposed tight restrictions on withdrawals, that is only Rs 10,000 in three months.

Many depositors did not have access to their money for building their houses or marriages of their children. Worse, many depositors did not have money for better treatment, said the ED in its remand report submitted to the special court in Kochi.

Velayudhan T C (70) wife Radhika V K were victims of the restrictions. Their Rs 15.73 lakh is stuck in Karuvannur. "My son's wedding is on October 22 and we had to complete the construction of the house before that but the bank refuses to give us our money," said Radhika. The couple had to borrow Rs 7 lakh from four different places for the construction and wedding.

"This bank was built on my sweat and blood. Now they (the CPM) have destroyed it, and destroyed the town," said Velayudhan, an autorickshaw driver and member of the Pulaya Scheduled Caste community.

In the 1970s and 1980s, when he took a simple loan of Rs 500, the bank used to charge 18 per cent interest plus another 3 per cent if he defaulted. "That's how the bank grew. But I never defaulted. Whenever I got Rs 50 or Rs 100, I deposited it in the bank," he said. "I am 70 years old. I cannot make that money again," he said.

His son Surjith, an interior designer and groom-to-be, said his father used to wear slippers worth just Rs 50 but bought him sandals worth Rs 600. "That's how he saved money and raised us," he said. "Now they are stealing our money," he said.

Velayudhan said he wrote to Chief Minister Pinarayi Vijayan and Minister for Higher Education R Bindu, who represents Irinjalakuda constituency, to help him withdraw his money. "Bindu forwarded the letter to Vasavan (Minister for Cooperation). Vasavan forwarded it to the Registrar and the Registrar to the administrator who never turns up at the bank," he said.

He said he had gone to the bank many times. "If I ask for Rs 3 lakh, the bank would give me Rs 5,000 after making to come there many times," he said.

The officials in the bank kept lying to the couple that there was no issue even two years ago when he tried to withdraw his money. "Even now when the ED arrested four persons, they are saying there is no issue," said Velayudhan, who worked as a nursing assistant at Thrissur Medical College before driving an autorickshaw for a living.

All the employees of the bank got the jobs because they raised a few slogans for the CPM; they did not have to write any PSC exam, he said. "Even the secretary Sunil Kumar was our auto drivers' union secretary. They (CPM) made him the bank's secretary and look at him now," said Velayudhan.

He is still angry with the bank for not releasing money for the treatment of Philomena Devassy (70), who died on July 27, 2022. She was his colleague in the medical college and both retired on the same day. "We walked out of the medical college together holding bouquets," he fondly remembered the day.

When she was under treatment from June 2022, the bank ignored several requests from her husband Devassy to release money. Philomena had Rs 30 lakh in her account. She succumbed to the bank's apathy a year after Mukundan died. "After she died, the bank officials went to her house and gave some money to Devassy. Where did they get the money from? Should we have to die so that the bank will release our money?" Velayudhan said, his eyes welling up.

Next: Takeover scam: How a private financier robbed borrowers with help from banks in Thrissur