NEW DELHI, India — The Enforcement Directorate (ED) has conducted searches at multiple locations in Karnataka as part of a money laundering investigation involving alleged mobilisation of Rs 2,110.97 crore from the public. The agency said on Tuesday that it seized financial records and digital evidence linked to alleged fund diversion, movement of money and investments in immovable properties.
- ED searches: Operations were conducted in Belagavi, Chikkodi and Nipani on August 7.
- Investigation amount: The probe concerns approximately Rs 2,110.97 crore allegedly mobilised from investors.
- Repayments identified: The agency identified repayments of around Rs 333.89 crore during the search action.
- Funds under tracing: Approximately Rs 1,777.08 crore in alleged proceeds of crime remains to be traced, according to the ED.
ED searches linked to Shivam Associates
The ED’s Mangalore zonal office carried out the searches on August 7 under Section 17 of the Prevention of Money Laundering Act, 2002. The premises searched were associated with Shivam Associates, Shivanand Siddappa Neelannavar and other connected persons and entities.
According to the agency, the investigation originated from an FIR registered by Malamaruthi Police Station in Belagavi City under the Banning of Unregulated Deposit Schemes Act, 2019 and the Karnataka Protection of Interest of Depositors in Financial Establishments Act, 2004.
How the alleged investment network operated
The ED said its preliminary examination of banking information and other records showed substantial movement of funds through business, personal and intermediary accounts. The transactions included transfers involving stock brokers, fixed deposits, related individuals and other beneficiaries.
The agency has identified a financial connection involving Shivam Associates, Shivanand Siddappa Neelannavar, Subhash Ramagouda Nandargi, Mahesh S Neelannavar, Shivam Productions, Shivam Lifeline Pvt Ltd, Shivam Sevaa (OPC) Pvt Ltd and other associated persons and entities.
The investigation indicates that the public was allegedly encouraged to invest by promising returns of 3 per cent per month. The ED said approximately Rs 2,110.97 crore was accumulated from members of the public, while repayments of about Rs 333.89 crore have been identified.
Rs 1,777.08 crore allegedly remains untraced
Based on the figures cited by the agency, approximately Rs 1,777.08 crore of the alleged proceeds of crime is yet to be traced. The ED also said that a commission of 0.5 per cent was reportedly paid to leaders or commission agents involved in bringing members of the public into the investment arrangement.
The agency’s investigation is examining the movement and handling of the funds, including their alleged diversion, layering and parking through different financial channels.
Records and digital evidence seized
During the searches, ED officials recovered and seized documents and digital material relating to monetary transactions, alleged diversion and parking of funds, investments in immovable properties and dealings with individuals and entities associated with the accused.
The agency said the seized material indicates the generation, movement, layering and parking of alleged proceeds of crime. The recovered documents and digital evidence are now being examined as part of the ongoing investigation.
What happens next in the probe
The examination of the seized financial records and digital evidence is expected to help the ED trace the movement of the alleged proceeds of crime and establish the financial links identified during the investigation. The agency has not stated in the supplied material that the investigation has reached a final stage.
Frequently Asked Questions
What triggered the ED money laundering investigation in Karnataka?
The investigation was initiated on the basis of an FIR registered by Malamaruthi Police Station, Belagavi City, under laws concerning unregulated deposit schemes and protection of depositors’ interests in financial establishments.
How much money has the ED said is yet to be traced?
The ED said approximately Rs 1,777.08 crore out of the alleged proceeds of crime generated through the process remains to be traced, after identifying repayments of around Rs 333.89 crore.
