The Central Bureau of Investigation has arrested Janata Dal Secular leader and casino owner KC Veerendra in connection with seizure of Rs 5.7 crore in Rs 2000 denomination from his possession.
Agency sources said CBI has registered a case against officials of four banks--State Bank of India, State Bank of Mysore, ICICI Bank and Kotak Mahindra Bank.
"We have arrested KC Veerendra. He was arrested in Hubballi on December 10 and brought to Bengaluru the following day and produced before the CBI court. He is in our custody for six days," a top CBI official said on Tuesday.
On December 10, I-T officials had raided 15 premises, including Veerendra's house in Challakere and a casino owned by him in Goa. The officials seized Rs 5.7 crore in Rs 2,000 currency notes, besides Rs 90 lakh in Rs 100 and Rs 20 denominations in Hubballi district and in Challakere.
CBI sources said Veerendra allegedly connived with some bankers and middlemen to exchange demonetised currency with Rs 2,000 notes.
Earlier, Veerendra's name had figured in a cricket betting case, the sources said. He was running a chit fund business and later forayed into casino and other ventures.
Veerendra, also a businessman from Challakere in Chitradurga district, is a former chairman of Primary Land Development Bank.
The sources said during preliminary probe names of several persons have been taken by Veerendra and it is trying to gather material evidence linking the alleged hawala operator with them.
The sources said during the six days of questioning CBI will confront him with documents recovered from his premises and will try to get the source of these funds which may unravel alleged involvement of senior bank officials in the case.
(With PTI inputs)
