An investigation into the BSNL Engineers’ Cooperative Society (No. T-950) scam has held former governing body members and staff liable for the loss of ₹362.02 crore, including interest, to the society.

The sum includes ₹257.34 crore of embezzled money and ₹104.67 crore which amounts to interest at 18%, the report of the investigation carried out under Section 68(1) of the Kerala Cooperative Societies Act said. Individuals who held the posts of president, honorary secretary, other governing body members and staff during the period from December 24, 2007, to December 25, 2022, have been held accountable for the misappropriation of funds and related offences.

Fabricating documents

The investigation found the governing bodies, especially the president, secretary and staff guilty of offences under Sections 94(5) and 94(8A) of the Act for fabricating documents, fudging data and embezzling funds, thereby causing a loss of ₹257.34 crore to the society. The interest at 18% up till December 31, 2024, has been pegged at ₹104.67 crore.

A.R. Gopinathan, former president of the society and a prime accused in the case, had passed away. According to the report, the total liability of ten of the accused comes to over ₹30 crore each, including interest amount of over ₹10 crore each at 18%. These ten individuals include the late Gopinathan and A.R. Rajeev, a staff at the society and one of the key accused in the case.

Gopinathan had served as honorary secretary from December 1997 to December 2017 and president from December 2017 to December 2022, the report noted.

The investigation under Section 68(1) was carried out following a probe under Section 65 which deals with inquiries conducted by the Registrar of Cooperative Societies.

Life savings

The scam concerns the embezzlement of depositors’ money over several years. Hundreds of depositors, a majority of them in the 65-85 age group, who had invested in deposit schemes offered by the society, were cheated of their life savings. The initial inquiry report on the scam had found serious financial misappropriation carried out through bogus fixed deposit receipts, parallel registers and issuance of fixed deposit certificates without making entries in the fixed deposit register.