New Delhi, Nov 24 (IANS): The Enforcement Directorate (ED) on Friday said that it has arrested N. Bhasurangan, former president of Kandala Service Co-operative Bank, Kerala, who played a key role in sanctioning various unauthorized loans.

The ED said that it arrested Bhasurangan and his son Akhiljith J.B. on Tuesday in connection with its money laundering case of fraud which occurred in Kandala Service Co-operative Bank.

It added that Bhasurangan happened to be the overall in-charge of the bank as president, who played a key role in sanctioning various unauthorized loans.

The agency said that it registered a case of money laudnering on the basis of various FIRs registered by the Maranalloor Police Station, Trivandrum against the President and Secretary of Kandala Service Co-operative Bank.

"ED probe found that several irregularities in the management of the bank. The Bank’s governing body was headed by its President Bhasurangan. Preliminary investigations revealed that Rs 57 crore was involved inthe above irregularities and the Bank suffered massive asset impairment due to this," the agency said.

The central agency also found that Kandala Service Co-operative Bank had given a loan of Rs 2.04 crore to Maranalloor Ksheera Vyavsaya Sangam Limited, as Bhasurangan was also managing the affairs of that Society.

"It was further found that multiple loans running into several crores were fraudulently given to his family members and relatives by mortgaging same properties. It was also found that Kandala Service Co-operative Bank had not initiated any recovery proceedings in respect of the overdue loans availed by the family members and relatives of Bhasurangan, while he was holding the post of President," the ED said.

The ED said that Bhasurangan and Akhiljith were produced before the Special Judge in Kerala's Ernakulam and was sent to ED custody for three days.