ED Arrests Former Congress MP Kuldeep Rai Sharma in ₹500 crore Fraud
Massive fraud uncovered at Andaman bank; arrests made.
The Enforcement Directorate (ED) has arrested former Congress MP Kuldeep Rai Sharma, alongside K Murugan, former managing director, and K Kalaivanan, former loan officer of the Andaman and Nicobar State Cooperative Bank Ltd (ANSCBL), in a massive ₹500 crore loan scam. The trio was apprehended under the Prevention of Money Laundering Act (PMLA), 2002, on Wednesday evening and flown to Kolkata on Thursday for further investigation.
The ED’s Kolkata Zonal Office revealed that the scam involved sanctioning loans worth over ₹500 crore through more than 100 fraudulent accounts opened in the names of shell companies and fictitious firms. Approximately ₹230 crore was allegedly siphoned off for the personal gain of Sharma and his close associates, including Murugan and Kalaivanan. The ED alleges that the officials sanctioned these loans in clear violation of banking regulations, often approving multiple loans for associates in exchange for a 5% commission, funneled through cash or shell company accounts.
The investigation began after the Andaman & Nicobar Police’s Crime & Economic Offences Cell filed an FIR on May 15, 2025, following a complaint from the deputy registrar of cooperative societies. The complaint highlighted gross irregularities in loan disbursements by ANSCBL. Sharma was first arrested by the local police on July 18, 2025, prompting the ED to launch a parallel probe under PMLA.
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On July 31, 2025, ED officials conducted extensive raids at 21 locations across the Andaman and Nicobar Islands, targeting the offices and residences of bank officials and associated businessmen. Since then, the agency has summoned over 10 individuals to its Kolkata office for questioning. Ongoing searches at three additional premises in the islands are expected to uncover further evidence of the scam’s scale.
According to the ED, a significant portion of the fraudulently obtained loan amounts was withdrawn in cash and distributed as illegal gratification among senior bank officials, including the former MP. “The scale of this conspiracy is staggering. Loans were approved with no regard for due diligence, purely to enrich a select few,” a senior ED official stated. The accused have been remanded to ED custody for eight days by a Special Court (PMLA) to facilitate further interrogation.
The ED’s investigation continues to unravel the intricate web of financial misconduct, with officials promising more revelations soon. “We are committed to tracing every rupee and holding all responsible parties accountable,” the official added.
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