Staff Reporter

Krishnamurthy has refunded Rs. 70 cr. to the investors

He was arrested in Mandya on Sunday

BANGALORE: The South Division police have arrested Suresh Krishnamurthy, proprietor of an Ulsoor-based finance company and a business associate of Sreenivasa Shastry of Viniv Inc, who had allegedly cheated 3,000 investors of about Rs. 100 crore.

Commissioner of Police Neelam Achuta Rao told presspersons on Tuesday that Krishnamurthy was arrested in connection with the four cases that were registered against him in the Ulsoor and Thyagarajanagar police stations in 2005.

Soon after the Viniv Inc scam came to light in 2005, people who had invested in Investec lodged complaints with the police that Krishnamurthy had cheated them by promising higher rates of interest.

According to the police, Shastry is said to have had invested crores of rupees, which he had collected from Viniv Inc depositors, in Investec.

The Commissioner said the South division police, who were investigating the 2005 cases, arrested Krishnamurthy in Mandya on Sunday while he was travelling from Varanasi to Chennai.

Investigations have revealed that Krishnamurthy has already refunded Rs. 70 crore to the investors and he is yet to return Rs. 30 crore. Several land developers and middlemen have grabbed landed properties and cash from Krishnamurthy. Efforts are on to seize the properties from these persons, Mr. Achuta Rao said.

Asked why the police had not arrested Krishnamurthy soon after the cases were registered against him in 2005, Joint Commissioner of Police (Crime) Gopal B. Hosur said they had not proceeded against him as he had promised to repay the investors and also had promptly repaid the money for some time. However, he had been at large since 2006.

Mr. Hosur said police security had been provided to Krishnamurthy in 2005 following a threat to his life.

According to Deputy Commissioner of Police (South) Alok Kumar, who supervised the investigations, Krishnamurthy had been living in Pune under a false name. He had also lived in New Delhi, Mumbai and Varanasi for some time.

Krishnamurthy was produced before the jurisdictional court on Monday and the magistrate remanded him in police custody for 10 days.