Thiruvananthapuram: In a new development, the District Cooperative Department in Thiruvananthapuram has begun a fresh investigation into the Nemom Service Cooperative Bank. The inquiry, mandated under Section 68(1) of state cooperative rules, was ordered after an earlier, less exhaustive probe uncovered a shocking reality.
A prior report under Section 65 had determined that the financial wrongdoing was not the estimated ₹44 crore, but a staggering ₹100 crore. This massive increase highlights a systemic failure and points to corruption deep within the bank’s administration. The goal of the new inquiry is to formally verify these alarming findings and prepare the ground for legal action.
Forged Fixed Deposits Used to Defraud State Firm
The previous report also laid bare the specific, deceptive techniques used by the bank’s administrative panel. The main method involved using forged Fixed Deposit (FD) receipts to cheat the state-run Kerala State Financial Enterprises (KSFE).
The bank’s board members would allegedly deposit a small amount—such as ₹20,000—but fraudulently generate FD receipts with a much larger value, like ₹2 lakh. They then used these fake receipts to secure large loans and access chit funds from KSFE. This particular scheme alone cost the state firm approximately ₹3 crore. Furthermore, the investigation revealed that numerous loans were disbursed under benami (fictitious) names without any genuine collateral or guarantees.
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Escalating the Official Response
The new Section 68(1) inquiry is a formal step to legally validate the scale and nature of the fraud. An officer from the cooperative department confirmed that once the verification is complete, authorities will move to the next stage under Section 68(2). This stage involves a powerful set of punitive actions, including officially summoning the accused individuals and initiating revenue recovery measures to seize assets and recover the lost funds.
Depositors Face Ruin and Demand Urgent Relief
While officials focus on verifying figures and administrative processes, the bank’s hundreds of depositors continue to face severe financial hardship. They have openly criticized the cooperative department, arguing that officials are more focused on the technical process of reopening the bank than on the immediate, desperate needs of the people.
Many depositors, already ruined, have had to defer critical expenses like medical treatments, marriages, and education. Depositor forums have stated that the financial distress has been so severe that it has led to suicides. They are urgently calling on the state government to intervene with an immediate financial relief package to prevent further tragedies and help those who have lost their life savings.
