The Central Bureau of Investigation has registered an FIR to probe into the scam involving the misappropriation of over ₹7.5 crores from the Kerala Advocates Welfare Fund. The amount was allegedly swindled through fake documents over a span of 10 years.The Kerala High Court had recently directed a CBI investigation into the scam weighing the depravity of the offence. The fund was constituted...
The Central Bureau of Investigation has registered an FIR to probe into the scam involving the misappropriation of over ₹7.5 crores from the Kerala Advocates Welfare Fund. The amount was allegedly swindled through fake documents over a span of 10 years.
The Kerala High Court had recently directed a CBI investigation into the scam weighing the depravity of the offence.
The fund was constituted to provide retirement benefits and social security to advocates in Kerala. The source of the fund consists of amounts paid by the Bar Council, contributions made by the Bar Council, Voluntary donations or contributions made by the Bar Council of India or by any other Bar Associations and includes all sums by way of sale of stamps under Section 22 of the Kerala Court Fees and Suit Valuation Act.
Under Section 9 of the Act, the Trustee committee is to administer the fund and hold the assets belonging to the funds and the trust. Under Section 10 (4) of the Act, it is mandatory to audit all accounts of the Trustee Committee annually by a Chartered Accountant appointed by the Bar Council. However, it was alleged that the same had not been done properly for some years.
In 2017, allegations of serious financial irregularities in its utilisation of funds were raised and the same was deliberated by the Trustee Committee in its meeting held in 2019. Thereafter, it was decided to take action and request for a vigilance enquiry regarding the irregularities and defalcation in the printing and distributing of welfare fund stamps entrusted to the Bar Council of Kerala.
Accordingly, the Vigilance Department registered a first information report against one Chandran, who was the then accountant of the trustee fund, alleging offences under section 13 (2) read with 13(1)(c)(d) of the Prevention of Corruption Act.
Investigations revealed that there was large-scale misappropriation of the funds and that there was no auditing since 2007. Therefore, several lawyers practising before various courts across the State approached the Court and sought directions entrusting the investigation of the case to the Central Bureau of Investigation.
The Vigilance and Anti-Corruption Bureau filed a detailed statement arguing that the investigation was progressing in a steady manner and substantial evidence had been collected.
They submitted that during the course of the investigation, two audits were conducted, one by the Kerala Local Fund Audit, which revealed a pecuniary loss of ₹ 6,72,51,250 and another one by the Statutory Auditor appointed by the Kerala Advocates Welfare Fund Trust Committee, which revealed misappropriation of ₹7,61,24,725. Moreover, two of the accused, accountant MK Chandran and one Babu Scaria were arrested pursuant to their investigation in 2019, they added.
However, it was stated that their investigation did not reveal any evidence of a criminal conspiracy by the office-bearers of the Kerala Bar Council or by any of its members/Secretary of the Kerala Advocates' Welfare Fund Trustee Committee.
The Court opined that considering the huge amounts involved, the complexity of crime, lack of various records and that materials were spread over two States, it should have been investigated effectively with a larger team of investigation even from the beginning. It, therefore, ordered that the investigation be handed over to the CBI within a month.
Thereafter, the Bar Council of Kerala had issued a press release disclosing that it does not plan to appeal against the High Court's decision to initiate a CBI probe into the Advocates Welfare Fund scam. In fact, it was added that the Council endorses the verdict of the Court.