The Enforcement Directorate (ED) Wednesday said it has seized six Mercedes-Benz cars belonging to Karnataka Congress MLA K C Veerendra Puppy and frozen Rs 55 crore in various bank accounts. The agency is investigating an online and offline betting case, in which the Congress leader has been arrested.
According to ED, five of the Benz cars seized have registration plates ending with VIP number 0003. The amount frozen includes approximately Rs 40.69 crore in nine bank accounts and one Demat account belonging to Veerendra. Additionally, Rs 14.46 crore has been recovered from 262 mule accounts connected to one of the accused gateways. These accounts were utilised to route money collected by multiple gaming websites operated by Veerendra and his associates, as per the agency.
On August 22 and 23, ED carried out searches at 31 locations linked to Veerendra, the Chitradurga MLA, as well as his brothers and associates. ED also arrested Veerendra in Gangtok, where he was on a business visit. He is presently in ED custody.
During those searches, ED seized Rs 12 crore in cash, gold ornaments worth Rs 6 crore, silver articles of around 10 kg and four vehicles.
ED said, “Further investigation has revealed that the accused is running several online betting sites in the name of King567, Raja567, Lion567, etc. It has also been revealed that several gateways have been used for routing payments collected through these websites.”
According to ED, the money collected from these websites, which Veerendra and his associates operate through a single gateway, is more than Rs 2,000 crore. The agency said it has found that K C Thippeswamy, brother of the accused, is operating three business entities from Dubai. Diamond Softech, TRS Technologies, Prime9Technologies, and these entities are related to the call centre services and gaming business of Veerendra.
It is suspected that many more Dubai-based entities, such as Castle Rock Project Management Services and Lascaux Core Project Management Services, have been incorporated by Veerendra in partnership with Thippeswamy, Pruthvi N.Raj, Anil Gowda, and others, according to ED.
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ED investigation revealed that the mule accounts are provided by various middlemen to the operators of these gaming websites, in this case, Appu alias Pruthvi N Raj (nephew of K C Veerendra), who, in turn, use the same to collect the funds received from various players. These transactions allegedly involve layering the player’s money deposits through escrow accounts of gateways and TSPs, and then making settlements in mule accounts controlled by the gaming site owners.
According to ED, these funds are further siphoned off in various ways, including through hawala transactions. Veerendra and his associates in Dubai are operating multiple gaming websites using various gateways and fintech service providers to layer funds and disguise their illicit activities as legitimate e-commerce businesses, as per ED.
K C Veerendra, a close associate of D K Shivakumar
K C Veerendra is regarded as a close associate of Karnataka Deputy Chief Minister D K Shivakumar. He is also the son-in-law of Kannada film actor Doddanna. In 2016, Veerendra was arrested by the Central Bureau of Investigation (CBI) for attempting to launder money during the demonetisation period. His arrest followed a seizure of Rs 5.7 crore in cash, in new Rs 2,000 notes, which was found in a secret chamber in the bathroom of his residence by Income Tax officials. The case was later closed due to a lack of incriminating evidence linking the funds to illegal sources.