The Enforcement Directorate searched 11 locations across Kerala and Tamil Nadu over allegations that public deposits collected by Bharath Lajhna Multi State Cooperative Society were diverted for personal use and used to acquire land, widening a financial investigation affecting the society’s depositors and members.
The searches were conducted under the Prevention of Money Laundering Act at premises in Kochi, Kozhikode and Chennai linked to R Premkumar, a founding member and the de facto chairman and managing director of BLM, as well as several other people. The action followed a Kerala Crime Branch investigation into alleged diversion of crores of rupees from depositors’ funds into accounts held by Premkumar’s relatives.
According to the reported Enforcement Directorate investigation, the diverted funds may have been used, among other purposes, to purchase around 500 acres in Kancheepuram district in the names of family members. The agency registered an enforcement case information report against the society and Premkumar after allegations that BLM had cheated members of the public by promising high returns on their investments.
The searches were expected to continue on Thursday because investigators had not yet covered the premises of all suspects, ED sources said. The agency’s action places the society’s alleged deposit mobilisation, related bank accounts and land transactions within a money-laundering investigation. Investigators have reportedly examined 320 bank accounts linked to the suspected scam.
Premkumar was arrested from his Chennai residence on October 29 and produced before a judicial first-class magistrate court in Kozhikode. He secured bail shortly afterwards, citing procedural lapses in the arrest. The Crime Branch has approached the court seeking permission to arrest him again.
The initial police case arose from a complaint filed by BLM’s former chief executive officer, who alleged that Premkumar and others had physically assaulted him. Although that complaint was later withdrawn, the Crime Branch registered a first information report after finding evidence of suspected financial irregularities. A separate cheating case was subsequently registered in Kothamangalam over an alleged fraud involving Rs 1.6 crore.
The investigation has brought the financial administration of a large multi-state cooperative society under scrutiny. Established in Chennai in 2006, BLM claims to have around 150 branches and more than 15 lakh members. The scale of its claimed membership means that any disruption involving deposits, withdrawals or asset recovery could have consequences beyond the individuals named in the investigation.
BLM has denied the allegations against Premkumar. Its management has maintained that the society’s assets exceed its liabilities, while the Enforcement Directorate continues its searches and the Crime Branch pursues further action in the related cases. The next steps will depend on the completion of the searches, the agency’s findings and the court’s decision on the Crime Branch request to arrest Premkumar again.
