The Enforcement Directorate has arrested C Parthasarathy, CMD, and G Krishna Hari, CFO of Karvy Group in an alleged money laundering case connected with the fraud committed through the illegal diversion of clients’ securities by Karvy Stock Broking Ltd worth Rs 2874 crore and pledging the same for obtaining loans.
The Enforcement Directorate has stated that Karvy pledged these securities with banks and NBFCs to seek loans and subsequent loan default. The agency further informed that it has got custody of the arrested accused for four days.
In September, the ED authorities conducted search operations at six locations connected to the KSBL for alleged money laundering. An official release from the ED said it had frozen shares of the Karvy Group.
The HDFC Bank alleging that KSBL had illegally pledged the securities of its clients and taken a loan of Rs 329 crore and diverted the same.
