The Kannur District Congress Committee (DCC) has alleged that people close to the CPM district secretary M V Jayarajan are involved in a fraud reported at the Iriveri Service Co-operative Bank.

The governing body of the CPM-controlled bank had taken action against the manager and secretary after it emerged that a group of people allegedly used forged documents to avail loans up to at least Rs 1 crore.

According to reports, the bank allocated Rs 10 lakh in loans to 10 persons on a particular day in 2019. An internal enquiry found that the loans were availed by employees of a private firm owned by Chakkarakkallu native Ragesh. A case was registered.

“The person who was a top official in the bank at the time of the crime is a close relative of M V Jayarajan,” said DCC General Secretary M K Mohanan. “It is a financial fraud and a political crime with the support of senior CPM leaders. The Congress party has decided to bring the issue to the limelight and we demand the arrest of the bank employees, office bearers and those who obtained the loan with forged documents. The investigation has loopholes to help the accused in the trial period,” Mohanan said.

Another DCC office bearer, advocate E R Vinod has claimed the fraud is similar to one unearthed at Karuvannur in Thrissur. “The Enforcement Directorate should be involved in the case considering its gravity. The bank gave loans to the individuals who presented forged documents in 2019 and nobody was aware of it until 2023,” Vinod said.