Trusting the permission of the cooperative department of Karnataka, ordinary citizens who invested hard-earned savings in several cooperatives in Karnataka, have nowhere to go today as the pace of investigation in Kanva Scam gives them hardly any hope.
The Kanva scam, a colossal financial fraud that ensnared thousands in Karnataka, is a stark reminder of the weakness of co-op movement. In 2019, the facade of the Sree Kanva Souharda Cooperative Credit Limited, operating under the Kanva Group banner, crumbled, revealing a Ponzi scheme of staggering proportions.
Over 23,000 depositors, many of them senior citizens lured by promises of exorbitant returns, found their hard-earned savings siphoned away, leaving a trail of financial ruin and emotional anguish. The scale of the fraud is mind-boggling. Estimates suggest losses exceed Rs. 1,500 crore, impacting people across Karnataka and neighboring states.
The Directorate of Cooperative Audit is now alleging that 1679 cooperatives across Karnataka state have swindled collective funds, straddling millions of depositors in despair, says Kanva Scam’s Claimants Forum in a social media post.
Directorate of Coop audit, Karnataka Cooperation department’s reply to question No. 119 in Karnataka Vidhana Parishat on 05 Dec 2023 paints a grim picture. Cooperative banks, credit societies, and other financial cooperatives have reportedly syphoned off funds meant for the welfare of their members. These victims include farmers, labourers, small traders, and marginalised communities that believed in the cooperative model as a beacon of financial security.
What’s even more concerning is the absence of cooperative department authorities to protect the interests of these victim communities. Despite the obvious misappropriation of collective funds, the Karnataka Public Investment Board (KPID) and the BUDS Act remain un-invoked because not a single Coop audit officer has initiated measures to protect the vulnerable victims in those cooperatives.
The victims, stranded to grapple with the uncertainty of their shattered trust, are demanding answers. Who will hold those perpetrators accountable? Where are the regulators who were supposed to prevent such malfeasance? The Directorate of Coop audit is deafeningly silent.
The victims demand the issue necessitates an immediate response, Karnataka government must commission a quasi-judicial inquiry into the misappropriation of cooperative funds. Nothing less than transparency, accountability, and justice is unalienable to the victims.
As these scandals unfold, it’s time to examine the cooperative administration. Are they still the pillars of community, or have they become breeding grounds for crime and corruption?
“Thousands of lives are at stake, and the government must act swiftly to restore faith in the cooperative movement. The victims’ voices must not be suppressed, let these scam incidents serve as a wake-up call for systemic reforms and renewed vigilance”, writes the Forum.