The city police on Wednesday raided the residence of underworld-linked businessmen who lent money at usurious rates of interest and employed violence to get it back.
City Police Commissioner P. Vijayan ordered the dawn raids, which were conducted almost simultaneously at 22 sites, including those in posh residential areas, luxury flats, and slum colonies.
The special drive, code-named ‘Operation Blade’ resulted in the arrest of eight suspected loan sharks, including two alleged gangsters, Goondukadu Shabu and Puthenpalam Rajesh.
The police recovered Rs.20 lakh in cash from them and seized hundreds of signed blank cheques, promissory notes, stamp papers, and land deeds, documents the accused had received as surety from their clients.
The police said the accused often charged an interest of up to Rs.1,000 a day on a loan of Rs.1 lakh, which meant an annual interest rate of 360 per cent.
Clients
Their clients ranged from citizens seeking urgent cash for treatment and weddings to real estate businessmen, migrant labour suppliers, wholesale perishable goods vendors and those profiting from illegal businesses.
The police said the accused, in a bid to fox the law, often forced their clients to sign land sale agreements to show, on the face of it, that the loans they had extended were actually genuine cash advances for the properties of the borrowers.
Most moneylenders kept their transactions secret and rarely registered or advertised their businesses to avoid taxes and legal scrutiny.
Some of the accused extended collateral-free “meter” loans, where interest is charged by the hour, and used their henchmen to retrieve it from defaulters.
The multi-crore racket has taken a heavy toll on urban society. It has fuelled crime, impoverished families, and driven many to suicide.
The accused were booked on the charges of cheating, forgery, and violating the Kerala Moneylenders Act. They will be produced before the court on Thursday. Assistant Commissioners of Police Reji Jacob, P. Biju, K. Vimal, and Circle Inspector Pramod Kumar coordinated the operation.
