RBI official arrested over money laundering
A senior special assistant with the Reserve Bank of India was among several men arrested in Bengaluru for alleged money laundering. KC Veerendra, a politician linked to the Janata Dal Secular, and the brother of government engineer SC Jayachandra were also among those taken into custody. The move follows raids during which millions of rupees in new INR2,000 ($30) notes, as well as luxury sports cars and gold were found.
By India Today Web Desk: A Senior Special Assistant employed with the Reserve Bank of India (RBI) in Bengaluru was arrested by the CBI today for money laundering and helping in the exchange of black money into white.

Sources in the RBI said the officer named K Michael was arrested by the CBI along with two others for his involvement in converting Rs 1.51 crore of black money.

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"K. Michael, a Senior Special Assistant in the Issue Department of RBI's regional office, has been arrested for his alleged involvement in conversion of old Rs 500 and Rs 1,000 notes worth Rs 6 lakh into Rs 100 notes at the State Bank of Mysore's (SBM) Kollegal branch in Chamrajpet district," said the official on anonymity.

Kollegal is 145 km from Bengaluru in Karnataka's southwest region.

Michael's arrest comes a week after the CBI on December 6 registered a case against the bank branch's senior cashier Parashivamurthy for allegedly laundering Rs 1.51 crore of new currency in exchange for old currency after the government demonetised those on November 8.

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"As the Kollegal branch is SBM's currency chest, large amounts of new notes in Rs 2,000 and Rs 500 were kept with lower-value notes for distribution to the bank's branches and state treasury offices in the district," pointed out the official.

Michael's name figured when CBI sleuths interrogated Parashivamurthy in the money laundering case.

"Coincidentally, Michael was at Kollegal on the day of demonetisation (November 8) to refill the currency chest with fresh stock and helped the bank's cashier convert the old notes for Rs 100 notes without proper documentation," said the official.

Michael's arrest came shortly after the CBI today arrested alleged hawala operator KV Veerendra in connection with seizure of Rs 5.70 crore of new currency notes of Rs 2000 denomination from his premises in Karanataka.

The agency has also registered a case against the officials of four banks - State Bank of India, State Bank of Mysore, ICICI Bank and Kotak Mahindra Bank.

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