Police have registered two criminal cases and arrested five key accused in connection with a large-scale financial fraud exceeding Rs30 crore at the Nallapadu branch of Guntur District Central Cooperative Bank (GDCC Bank Ltd). The scam allegedly involved a well-planned conspiracy among bank officials, committee members, traders, and others.
Based on complaints filed by GDCC Bank authorities, Nallapadu police registered the cases and initiated an investigation under the direction of Guntur Superintendent of Police Vakul Jindal. Two special investigation teams were formed to probe the irregularities.
Preliminary findings revealed that certain bank employees, the then branch chairperson, committee members, cold storage owners, and chilli traders colluded to sanction loans to fake self-help groups (SHGs), non-existent farmers, and against fabricated chilli stock records, causing massive losses to the bank.
In the first case, police found that loans were illegally sanctioned under DRDA, MEPMA, and JMD schemes in the names of bogus SHGs and farmers. Additionally, long-term loans were issued in violation of RBI guidelines, resulting in a loss of Rs22.25 crore. Police arrested Devarakonda Arun Kumari, the then manager of the Nallapadu branch, and Dhumawat Govind Nayak, a GDCC Bank central committee member. Both were remanded to judicial custody.
In the second case, investigators discovered that Rs8.34 crore was siphoned off into personal accounts using forged documents that falsely showed chilli stocks stored in cold storages. Loans were obtained using these fake records in the names of non-existent farmers. The three accused arrested in this case are chilli trader Bachchanaboyana Ramachandra Rao, Raghavendra Cold Storage manager Vanukura Venkateswara Reddy, and its managing director Challa Shiva Nagi Reddy.
Police stated that nearly 270 individuals have been identified as accused so far in both cases. Efforts are ongoing to trace the remaining suspects and recover the misappropriated funds.
