The Enforcement Directorate (ED) has registered a case under the Prevention of Money Laundering Act (PMLA) in connection with an alleged ₹100-crore scam involving approvals for private schools in Tamil Nadu.
The probe has been initiated on the basis of an FIR registered by the Central Crime Branch (CCB) of the Greater Chennai Police. The case involves allegations of collecting large sums from private school managements by promising government approvals and other regulatory clearances.
After obtaining the FIR and other records related to the case from the CCB, the ED has begun examining the alleged financial transactions and movement of funds. The agency is expected to decide on further questioning of the accused and other persons linked to the case based on the findings of its initial investigation.
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₹100 Crore Allegedly Collected From Schools
The case is linked to BT Arasakumar, who has been accused of heading an unregistered organisation called the ‘Tamil Nadu Private Schools Association’ and allegedly collecting around ₹100 crore from private school managements on the promise of securing various government approvals. According to the complaint, school managements were allegedly assured permanent recognition, upgradation, DTCP approvals and other statutory clearances. The complaint alleges that the promised approvals were not secured and the money was not returned.
The CCB arrested Arasakumar on June 27, 2026. He was subsequently detained under the Goondas Act. However, a special court granted him default bail towards the end of September after the investigating agency failed to file its final report within the stipulated 90-day period.
Former Minister Named as Accused
The investigation has also brought the name of former Tamil Nadu School Education Minister Anbil Mahesh Poyyamozhi into the case. The CCB named him as an accused on September 16 and conducted searches at several premises linked to him in Chennai and Tiruchirappalli. Police seized documents and electronic devices during the searches.
According to the CCB, the investigation has expanded to 177 private schools from which money was allegedly collected on the promise of securing government approvals. Subsequent searches were also conducted at locations linked to associates of the former minister and other accused persons. During searches conducted on September 29, investigators reportedly seized 44 documents and a laptop from five locations.
Poyyamozhi Denies Allegations
The CCB also questioned Poyyamozhi for around eight hours in September. He denied the allegations, saying that he had answered the questions put to him by the police and described the case as baseless. He also claimed that some of the documents seized during the searches were unrelated to the case.
Poyyamozhi has approached the Madras High Court seeking quashing of the case registered by the CCB. His petition seeks cancellation of the FIR, and the matter was heard by the court towards the end of September.
ED to Trace Alleged Money Trail
The ED’s investigation will now focus primarily on the alleged proceeds collected from private school managements, their banking transactions, transfers between individuals and entities connected to the case, and any assets allegedly linked to the funds. Under the PMLA investigation, the agency will examine how the alleged proceeds of the scheduled offence were generated, transferred or used.
The allegations in the case remain under investigation and have not been established in court. None of the accused has been convicted in connection with the alleged scam. The ED’s probe will focus on the financial aspects of the case and the alleged movement and use of funds, separately from the CCB’s underlying criminal investigation.
The420 Takeaway
The ED’s entry shifts the focus to the alleged ₹100-crore money trail. Investigators will now examine whether money collected from private schools for promised approvals was transferred, used or converted into assets that could qualify as proceeds of crime under the PMLA.
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