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The Directorate of Enforcement (ED) has filed a supplementary prosecution complaint against former MP Kuldeep Rai Sharma and 13 other persons and entities in an alleged bank fraud case involving the Andaman and Nicobar State Cooperative Bank (ANSCBL). The case involves proceeds of crime estimated at more than Rs 500 crore, according to the agency.
The ED’s Kolkata Zonal Office-II filed the complaint on November 6, 2026, before the Special Court under the Prevention of Money Laundering Act (PMLA) in Port Blair. The supplementary complaint names 14 additional accused, taking the total number of accused in the case to 52, the agency said in a press release issued on November 11.
What Triggered The Investigation?
The ED initiated its investigation on the basis of an FIR registered by the Crime and Economic Offences Police Station of the Andaman and Nicobar Police. The case concerns alleged financial irregularities involving private individuals and officials of ANSCBL.
According to the ED, those allegedly involved included Kuldeep Rai Sharma, then the bank’s vice-chairman and a former MP, along with other officials responsible for sanctioning bank loans. The agency alleged that they acted in connivance with associates to establish 23 shell companies and secure substantial loans for these entities as well as regular business concerns.
The loans were allegedly sanctioned in violation of banking rules and without any intention of repayment. The ED stated that approximately Rs 301.50 crore was disbursed to 21 shell companies alone. Of this amount, around Rs 271 crore had turned into non-performing assets (NPAs).
The agency has identified total proceeds of crime exceeding Rs 500 crore in the case. Its investigation has focused on the alleged creation of shell companies, irregular loan sanctions and the subsequent diversion of funds.
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How Were Shell Companies And Loans Allegedly Used?
The ED said its investigation revealed that shell companies were established in the names of associates or dummy directors. These entities allegedly secured substantial loans within a few months of incorporation despite having no business records.
The agency further alleged that low-value land parcels were pledged as collateral after their valuations were inflated several times. This was allegedly carried out in collusion with bank officials and private individuals.
The same properties were reportedly used repeatedly as mortgage security to obtain higher loan amounts. According to the ED, once the loans were disbursed, the money was quickly withdrawn in cash or transferred through multiple bank accounts associated with shell companies and their associates.
The agency alleged that the funds were not utilised for the purposes stated in the loan applications. Instead, the transactions involved several accounts through which the money was moved after its release from the bank.
Where Was The Allegedly Diverted Money Invested?
According to the ED, the diverted funds were used to purchase land, construct hotels and resorts, acquire semi-submarine tourist vessels and repay existing loans. The assets were allegedly acquired mainly in the names of family members and associates to conceal their actual ownership.
The investigation also revealed alleged irregularities in the transfer and ownership of land parcels. The agency said some properties were taken over through powers of attorney or sale agreements without registered sale deeds, arrangements that allegedly helped conceal the identities of their actual owners.
The same properties were subsequently pledged with the bank as security for fresh loans. The ED said these additional loans also turned into NPAs, adding to the financial exposure identified during the investigation.
Who Are The Newly Named Accused?
The supplementary prosecution complaint names Jayanta Bala, J. Suresh Chandran, an empanelled property valuer of ANSCBL, John Robert Babu, Anil Kumar, Md. Ali, P. Abhilash and Kiran Lal N. H., along with their respective companies.
The addition of these individuals and entities has increased the total number of accused in the case to 52. The complaint was filed before the Special Court under the PMLA in Port Blair on November 6.
The ED’s allegations centre on the sanctioning of loans to shell companies, inflated property valuations, repeated use of land as collateral and the alleged diversion of funds through multiple bank accounts. The agency’s November 11 press release identified the total proceeds of crime in the case as more than Rs 500 crore.
