ED arrests ex-MP from Andaman and Nicobar Islands among 3 in bank fraud case

New Delhi [India], September 17 (ANI): The Enforcement Directorate (ED) on Wednesday arrested Kuldeep Rai Sharma, ex-Member of Parliament from Andaman and Nicobar Islands, and two others in connection with its ongoing probe in a bank fraud case.
ED's Kolkata Zonal Office arrested Sharma, who is also the ex-Chairman of Andaman and Nicobar State Cooperative Bank (ANSCBL); and K Murugan, Managing Director (ANSCBL); and K Kalaivanan, Loan Officer (ANSCBL), under the provisions of the PMLA, 2002.

ED, Kolkata has arrested three persons, namely Kuldeep Rai Sharma, Ex-Member of Parliament, Andaman and Nicobar Islands & Ex-Chairman of Andaman and Nicobar State Cooperative Bank (ANSCBL); K. Murugan, Managing Director (ANSCBL); and K. Kalaivanan, Loan Officer (ANSCBL), under…

— ED (@dir_ed) September 17, 2025

A special Prevention of Money Laundering Act (PMLA) court has remanded Sharma and K. Kalaivanan to ED custody for a period of eight days.
These are the first-ever arrests made by ED in the Union Territory of Andaman and Nicobar Islands.
ED initiated an investigation on the basis of a First Information Report (FIR) registered by the Crime and Economic Offences Cell, Andaman and Nicobar Police, against various private persons and officials of the bank.
ED said the case pertains to the fraud committed by the officials of Andaman and Nicobar State Cooperative Bank Ltd, including Sharma and others responsible for sanctioning bank loans.
"These persons, in connivance with their accomplices, floated several shell companies and sanctioned large loans to them as well as to their regular entities in flagrant violation of the rules and lain down procedure of the bank with the sole intent of not repaying the funds, thereby causing losses to the bank and generating corresponding gains for themselves," said the ED in a statement.
ED said its investigation conducted so far indicated that loan facilities were sanctioned through more than 100 loan accounts in the names of various firms and shell companies, in complete disregard of the laid-down procedures and guidelines of the bank, and the amount involved in the fraud and Non-Performing Assets (NPA) exceeds Rs 500 crore.
"Evidence collected so far also indicates that a loan amount of Rs 230 crores was fraudulently taken exclusively for the benefit of Kuldeep Rai Sharma and his associates, including the Managing Director and Loan Officer," stated the ED.
The ED investigation has also revealed that K Murugan, MD and K Kalaivanan, Loan Officer, also fraudulently availed loans from the bank in the names of companies incorporated in the names of relatives. "They helped their associates to obtain multiple loans in lieu of 5 per cent commission, which were made on the instructions of Kuldeep Rai Sharma. The commission amount was taken either in the form of cash or through associates by using the accounts of shell companies."
Further, searches are being conducted at three premises in the Andaman and Nicobar Islands in furtherance of earlier searches in relation to the diversion of bank funds, said the federal agency.
In this case, ED said earlier searches were conducted at 21 premises on July 31 and August 1 this year, including those of shell companies created by Sharma in connivance with his associates.
"The investigation has revealed that loan amounts were diverted and syphoned off through multiple shell entities, and a substantial portion of these loans were withdrawn in cash and paid as shares to senior bank officials, including Kuldeep Rai Sharma," added the agency. (ANI)