• August 23, 2017
    Last updated 12 minutes ago

india

Lalu targets Nitish, deputy in Rs10b fund transfer scam

A special investigation team probing the scandal has arrested 7 suspects

18:50 August 13, 2017

Patna: RJD president Lalu Prasad set off a storm in political circles in Bihar with his charge that chief minister Nitish Kumar and his deputy Sushil Kumar Modi were directly involved in a fund transfer scam amounting to Rs10 billion (Dh572.8 million) by allegedly fraudulently diverting government money to the account of a Bhagalpur-based NGO named Srijan Srijan Mahila Vikas Sahyog Samiti. Bhagalpur is a district located in the eastern part of the state.

Authorities investigating the scam have so far found that public funds to the tune of Rs10 billion — almost the size of the Bihar fodder scam in which the RJD chief is accused — had been embezzled. Investigating officials reckon the racket could be much bigger.

The modus operandi that came to light in the scandal is that, once the state government released funds to the district administration, the funds were later transferred to the said NGO’s bank account — with forged signatures of district magistrates allegedly ensuring that the transactions were completed with the collusion of some bank officials.

A special investigation team probing the scandal has, so far, arrested seven persons including the stenographer of the Bhagalpur district magistrate, besides other government officials, a clerk at Indian Bank and the NGO’s managing director.

“This scam is worth Rs1000 crore [10 billion] and the money clandestinely withdrawn from government treasury was used in real estate, business and for money laundering but is being investigated by the Nitish Kumar government’s own police only to save the accused persons,” Lalu alleged while addressing the media on Saturday.

Describing the scandal as bigger than the fodder scam, Lalu has also demanded a Central Bureau of Investigation (CBI) probe into it to bring out the whole truth besides the registration of cases against the chief minister and his deputy.

Lalu further alleged that the NGO came into being in 2005 — right at the time that the NDA government led by Kumar first came to power in Bihar and added that, all through the NDA government’s tenure, deputy CM Modi had remained in charge of the Finance Department.

“As per the treasury act and Finance Department rules, the money withdrawn from the treasury can’t be deposited in the bank account. The question here is that with whose permission a huge amount of government funds was withdrawn from the treasury and then deposited in banks as well as in the bank accounts of the NGO?” Lalu asked.

He also wondered at the way the state government had sought to ignore the 2013 Reserve Bank of India (RBI) order for an inquiry into the irregularities.

“For the same reason, I was made accused in the fodder scam. On similar ground, fraud cases should be registered against chief minister Nitish Kumar and his deputy Sushil Modi,” demanded Lalu. “I request CBI to lodge FIR against Bihar government for allegedly parking thousands of crores government’s money in a fraud NGO in Bhagalpur.”

The RJD president also released to the media some photographs showing alleged closeness of the chief minister, his deputy and several BJP leaders with the top official of the NGO. The photographs show Nitish and BJP leaders including his deputy Modi, federal minister Giriraj Singh and Shahnawaz Hussain attending functions of the NGO.