Senior RBI official arrested by CBI in Bengaluru for money laundering

The CBI on Tuesday arrested K Michael, senior special assistant, Issue Department, RBI, for allegedly helping a friend convert demonetised high denomination notes to the tune of Rs. 6 lakh into Rs. 100 denominations at State Bank of Mysore, Kollegala, without proper documentation.

On December 6, the CBI registered a case against Parashivamurthy, senior cashier of the branch, for allegedly giving Rs. 1.51 crore of new currency in exchange of old demonetised notes without proper documentation. A probe into the case revealed the involvement of Mr. Michael.

CBI officials said the SBM, Kollegala, is a currency chest from where currency is issued to SBM branches in the locality.

Mr. Michael went to SBM, Kollegala, to refill currency on November 8 when the demonetisation was announced. Soon, he helped one of his friends to exchange old notes for Rs. 100 notes at the bank without any documentation in conspiracy with Mr. Prashivamurthy.

Several officials of the State Bank of India, the State Bank of Mysore, ICICI, Kotak Mahindra and other public sector banks have also come under the CBI scanner, following the arrest of alleged hawala operator K.C. Veerendra for exchange of Rs.5.76 crore in old notes to new currency in Bengaluru.

According to the CBI, two more persons named Thipeswamy and Venkatesh R were involved in the racket. “The bank officials allegedly entered into a conspiracy with the middlemen to facilitate the illegal exchange of notes in violation of the RBI circulars. The bank officials falsified the accounts on the basis of fabricated documents, identification papers, of several individuals. ATM machines are also suspected to have been used for withdrawals,” said an official.

SOURCE: PTI