The Enforcement Directorate has alleged that former Karnataka Public Service Commission examination controller Gyanendra Kumar Gangwar received approximately ₹1.30 crore in cash and luxury jewellery in exchange for leaking the question paper for the veterinary officer recruitment exam. The agency revealed the findings before a special court while seeking custody of Gangwar, an IAS officer who was arrested alongside suspected middleman Basavaraj Kannale in August 2026 under the Prevention of Money Laundering Act. Following the initial arrests, the Karnataka Criminal Investigation Department also took Kannale into custody to pursue its parallel inquiry into the recruitment scandal.
Cash, Diamond Jewellery, and Question Papers on Pen Drives
According to statements made by Kannale during questioning, Gangwar was paid ₹1.30 crore in direct cash payments and received substantial funds for high-end jewellery. The ED submitted that Kannale routed money to purchase a diamond necklace valued at approximately ₹23 lakh from a prominent showroom in Bengaluru. During Gangwar’s bail hearing, the CID stated that an additional gold necklace worth over ₹28 lakh was acquired through Kannale, noting that the ornament was subsequently recovered from one of Gangwar’s friends.
Investigators outlined that the breach occurred on January 7, two days before the scheduled January 9 examination. Kannale reportedly went to Gangwar’s official residence, where he obtained the question paper and corresponding answer keys on a pen drive. Bribe-paying candidates were subsequently assembled at rented Airbnb villas, where they were given advance access to the test materials. Kannale allegedly took advance bribes totaling nearly ₹1.50 crore from prospective candidates, charging between ₹30 lakh and ₹40 lakh per person. While some candidates paid in cash, investigators have traced approximately ₹80 lakh through bank transfers.
Scrutiny Expands Across Earlier Examinations and Senior Officials
Gangwar held the post of KPSC examination controller from 2024 until March 2026. The ED is examining whether the illicit network handled proceeds from other recruitment tests conducted throughout his two-year tenure. Financial records indicate that Kannale had been moving funds to Gangwar as early as 2025, leading investigators to suspect a prolonged financial relationship between the two men.
The ongoing inquiry has also brought other senior figures under the scanner. The ED and the CID are actively assessing the role of KPSC chairman Sahukar Shivashankarappa, along with several commission members, to establish how illicit funds were transferred, laundered, and concealed.
FIR by Unsuccessful Candidate Triggered Joint Agency Inquiry
The recruitment drive aimed to fill 400 government veterinary officer vacancies, drawing around 1,400 applicants. A total of 329 candidates were declared selected after the January examination. The integrity of the selection list was formally challenged on July 24, 2026, when an unsuccessful applicant, Dr S. Manjunath, lodged a First Information Report.
The complaint flagged significant anomalies in the results, specifically pointing out that 29 candidates with consistently poor academic backgrounds managed to secure scores above 450 out of 600 marks. Both the CID and the ED continue to trace the financial trail, working to identify additional intermediaries and beneficiaries involved in the leak.
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