Reports from Kerala State Financial Enterprises (KSFE) Limited indicate that frauds resembling those in the cooperative bank model are taking place. These reports allege that land title deeds are being pledged without the knowledge of the account holders. The situation is reminiscent of the Rs 300 crore scam involving the CPM-controlled Karuvannur Cooperative Bank. According to the reports, the fraud is orchestrated by a leader from a pro-ruling (LDF) organisation, who is reportedly being protected.
According to reports from Alappuzha, S. Rajeev, Special Grade Assistant at the KSFE Alappuzha Assistant General Manager’s Office, has been suspended amid the protests. He is the district vice-president of the KSFE Employees Association and a state committee member.
A female complainant alleged that Rajeev misused the title deed she submitted by presenting it as security for her Rs 30 lakh chit fund. This is one of the cases registered against him. Police have filed a case against him, based on a complaint by N. Suma, for cheating and financial fraud. It is now reported that he has gone underground.
Suma had joined a Rs 12 lakh chit fund at the Alappuzha Irumpupalam Branch of KSFE. She intended to avail a Rs 6 lakh house loan from that chit fund against the title deed of her 12 cents of land. Rajeev assisted her in completing the documentation. Subsequently, Rajeev convinced Suma that there was no proper road access to that plot; hence, he collected the title deed of another plot owned by Suma’s husband. Consequently, he availed the chit fund using Suma’s 12-cent plot’s title deed as security. When he defaulted on the repayment of the loaned amount, KSFE initiated revenue recovery procedures. Upon discovering this, Suma lodged several complaints with KSFE authorities. However, no action was taken, prompting her to approach the police.
In another incident, Rajeev’s relative, Saneesh, filed a complaint against him. His title deeds were misused by Rajeev in a manner similar to Suma’s case. It is now alleged that the documents are missing.
Raveendran and Manikkutty, another couple, have complained that their title deed for 4.18 acres of land was pledged, and a loan of Rs 10 lakhs was availed—all without their knowledge. Although they lodged complaints with the local police, no action was taken. Later, they reportedly complained to the District Police Chief, but so far, no action has been taken. They had availed a loan of Rs 8 lakhs and had repaid it. However, they did not receive their title deed back. Subsequently, they received a notice for the seizure of the land. Only then did they realise that their title deed had been pledged for a loan without their knowledge.
Now, the impoverished family does not know what to do. There are complaints that Rajeev operated the fraud with the assistance of employees of the institution; hence, the authorities hesitate to take action. There are also reports that Rajeev receives political protection, as he is the leader of the trade union affiliated with the ruling Front.
The episode highlights the pitiable situation prevailing in the financial institutions in Kerala.
The Kerala State Financial Enterprises Limited was established on 6 November 1969 with a paid-up capital of Rs 2 lakhs and 45 employees. At present, KSFE has 600 branches and 6,782 employees. KSFE is a fully State Government-owned company with 13 regional offices. The corporate office is situated at Thrissur. Chit funds constitute the main business of the organisation. In addition, deposits from the public are accepted, and loans are also disbursed.
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