Retired IAS officer arrested in BDA scam

The Hindu dated 27/4/16

The investigation into the multicrore-BDA-mutual fund scam has widened to include a retired IAS officer M.K. Monappa arrested by CID sleuths in connection with the scam on Tuesday.

So far, Sandeep Dash, an Indian Civil Accounts Service officer has been arrested along with two former employees of BDA. A former BDA commissioner was also interrogated in connection with the case last year. However, there is no case made against him.

The probe into the scandal has revealed that the officer had colluded with M.N. Sheshappa, a former member of BDA, and invested Rs. 2.12-crore BDA money in the name of Karnataka State Backward Classes Department Building Construction Society in mutual funds using ante-dated instruments.

Mr. Monappa, probe has now revealed, had diverted funds from the Society and invested in mutual funds. However, when he realised that he had suffered losses due to the investments, probe has now revealed, he colluded with Sheshappa, who was instrumental in running the scam in BDA to make up for the losses, sources said.

Explaining the modes operandi , a CID officer said, Sheshappa prepared a demand draft for Rs. 2.12 crore from BDA that Mr. Monappa used to invest in the mutual fund under the name of Karnataka State Backward Classes Department Building Construction Society. Just two days later, the transaction had been redeemed as a coverup act that probably could have blown the lid off the scam at the society, the officer said. Incidentally, the transaction was done in June 2006, just days after Mr. Monappa was transferred from the post.

CID sleuths probing the case said they are finding out whether Mr. Monappa gave Sheshappa Rs. 2.12 crore in cash, for the DD from BDA.

It is yet to be ascertained whether Sheshappa did receive any cash and whether he refilled that money into the BDA account.

M.K. Monappa had diverted funds from the Society and invested in mutual funds