The Enforcement Directorate (ED) has attached immovable assets worth Rs26 crore in connection with a large-scale financial fraud at the Karnataka Bhovi Development Corporation (KBDC). The properties were seized from BK Nagarajappa, the former general manager, and R Leelavathy, former managing director of KBDC. Both are currently in judicial custody at Bengaluru Central Prison after being arrested under the Prevention of Money Laundering Act (PMLA).
According to ED’s findings, Nagarajappa and Leelavathy colluded with middlemen and associates to siphon off public funds by creating over 750 fake beneficiary accounts. These accounts were used to fraudulently issue loans, subsidies, and financial aid from KBDC.
The diverted funds were traced to several entities—including Adithya Enterprises, Somanatheswara Enterprises, New Dreams Enterprises, Harntiha Creations, and Annika Enterprises—all reportedly controlled by Nagarajappa and his associates. The money was used to finance a lavish lifestyle and to acquire various assets, both movable and immovable, in their own names and those of their family members.
The ED continues to investigate the case to trace the full scale of the financial misappropriation and recover public funds.
