A charge sheet has been filed against nine private contractors in connection with a money-laundering case linked to an alleged scam in the Bruhat Bengaluru Mahanagara Palike, the Enforcement Directorate said on Monday.
The federal probe agency said in a statement that it slapped criminal charges under the Prevention of Money Laundering Act in the case "on the basis of" a charge sheet filed by Karnataka's crime investigation department against 40 engineers and 42 contractors.
The CID has alleged that the Bangalore civic body sanctioned work orders to these licensed contractors for executing a specific project but they "failed" to complete it or do it properly even though they received full payment, according to the ED.
"This caused a heavy loss to BBMP as well as to the exchequer at large," the agency said.
"It was further alleged that the accused contractors were also indulging in criminal activities, criminal conspiracy and creation of false documents to prove that they had executed the allotted work completely," the ED claimed.
The ED said it has filed a prosecution complaint or charge sheet against nine private contractors and a family member of the contractors -- NC Nagaraj, SD Shashikumar, Bharathi (Shashikumar's wife), G Kumar Swamy, M Nagesh, C Subramani, GS Shivaswamy, Babu Rao and KS Bharath -- before a special PMLA court in Bangalore.
It said assets worth Rs 5.12 crore of these accused were attached by it in January last year as part of this investigation.
"A probe found that these licensed contractors participated in the tendering process and after being awarded the contract, they executed sub-standard work and claimed excess bill than what they were entitled to.
"The excess amount drawn from BBMP was used by them for their personal gain resulting in loss to the government of Karnataka," the ED said.