Bengaluru: The Enforcement Directorate (ED) has arrested Karuturi Venkateswara Rao, a director of Deepak Cables (India) Limited, in connection with an alleged Rs 899.35 crore fraud involving a consortium of banks led by the State Bank of India.
The arrest was made by the ED’s Bengaluru Zonal Office following an ongoing investigation into allegations of large-scale financial irregularities and diversion of loan funds. A special court has remanded Rao to ED custody for 10 days to facilitate further questioning and investigation.
The action comes days after ED officials conducted searches at premises linked to Deepak Cables on May 19 and May 29. During the raids, investigators reportedly seized assets and recovered substantial amounts of cash. The agency also froze nearly Rs 18 crore held in multiple bank accounts connected to the case.
According to investigators, the company is accused of fraudulently diverting and misusing loans obtained from an SBI-led banking consortium. Authorities suspect that funds sanctioned for business operations were allegedly routed elsewhere in violation of lending norms, causing significant losses to the lending institutions.
The case initially came under scrutiny after the Central Bureau of Investigation registered an FIR based on allegations of bank fraud and financial misconduct. Acting on the CBI case, the ED launched a parallel money laundering investigation under provisions of the Prevention of Money Laundering Act (PMLA).
Officials believe the investigation could uncover a wider network of financial transactions and possible involvement of additional individuals. The agency is examining company records, banking transactions and seized documents to determine the extent of the alleged fraud.
The arrest marks a significant development in one of the major bank fraud cases currently under investigation, with authorities expected to intensify scrutiny of the company’s financial dealings in the coming weeks.
