CBI carried out searches on September 15, 2025 at 16 places in Karnataka and Andhra Pradesh in the Case reg Siphoning of Govt Funds to personal accounts of associates and relatives of the then Minister from the accounts of Karnataka Maharshi Valmiki Scheduled Tribes Development Corporation Limited, (KMVSTDCL), a Government of Karnataka undertaking, also referred as Valmiki Corporation, maintained at Union Bank of India, MG Road Branch, Bengaluru.
The case was registered on June 3, 2024 on the basis of a written complaint from DGM, Union Bank of India on alleged cheating, forgery, and criminal misappropriation of funds amounting to Rs 84.63 Crores through illegal transfer and withdrawal from the accounts of KMVSTDCL during the period February 3, 2024 to May 6, 2024.
On November 16, 2024, a Writ Petition was filed by Basangouda R. Patil, MLA, before the High Court of Karnataka, praying for directions to CBI to file a Final Report before the Court, and to submit interim status reports during the pendency of the petition. Since then, the Karnataka High Court has been monitoring the investigation. Four status reports have so far been filed by CBI before the State’s highest court.
During the investigation, further instances of diversion of Government funds belonging to the Scheduled Tribes Welfare Department and the Karnataka German Technical Training Institute (KGTTI) have been established.
The ST Welfare Department falls under the administrative control of the Scheduled Tribe Welfare Ministry, whose minister at the relevant time was B. Nagendra. Investigation revealed that Rs 2.17 Crores of ST Welfare Department funds were transferred from the account maintained with Bank of Baroda, Siddaiah Road Branch, Bengaluru, through intermediary firms such as SKR Infrastructure and Golden Establishment, into the account of Dhanalaxmi Enterprises belonging to Shri Nekkanti Nagaraj, a close associate of the B Nagendra. Out of these funds, approximately Rs 1.20 Crores were further routed into the accounts of the associates and relatives of the then minister B. Nagendra, including his sister, brother-in-law, and personal assistant.
Similarly, Rs 64 Lakhs belonging to KGTTI were diverted from its account at Canara Bank, Wilson Garden (Hombegowdanagar) Branch, Bengaluru, to Sadguru Education Trust and Sadguru Solutions, thereafter to Skillpoint Training, and ultimately to entities such as Style Machine, before reaching N. Ravikumar (brother of Shri Nekkanti Nagaraj) and N. Yashwanth Chowdhry (nephew of Shri Nekkanti Nagaraj).
Based on the status report submitted by CBI, the Karnataka High Court had earlier granted permission to CBI to also investigate into the above allegations.
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