B Nagendra Offers To Resign: What Is ₹89 Cr Valmiki Corporation Scam Rocking Karnataka?

Karnataka Minister B Nagendra has offered to resign from the state Cabinet amid allegations linked to the alleged ₹89.63-crore irregularities in the Karnataka Maharshi Valmiki Scheduled Tribes Development Corporation, an India Today report said.

According to the report, Nagendra, who currently holds the Youth Empowerment and Sports portfolio, conveyed his decision to Chief Minister DK Shivakumar, saying he did not want to cause embarrassment to the Congress and was willing to step down.

Nagendra was the Tribal Welfare Minister when the alleged financial irregularities came to light in 2024. He had resigned from the Cabinet in June that year amid the controversy and was later re-inducted.

The report further added that Nagendra remains confident that he will secure a clean chit in the case and has told Shivakumar that he could return to the Cabinet once the legal proceedings are resolved.

Shivakumar is expected to consult the Congress high command before deciding whether to accept the resignation.

What Is The Valmiki Corporation Case?

The alleged ₹89.63-crore fraud centres on the diversion of funds from the corporation through forged cheques, RTGS transactions and fictitious bank accounts.

According to the CBI, ₹89.63 crore was fraudulently transferred from corporation accounts using forged documents and banking instructions. The funds were subsequently allegedly routed through around 600 bank accounts and layered through multiple transactions before being converted into cash, bullion and other assets.

The Enforcement Directorate has also alleged that 18 fictitious accounts in Hyderabad were used to receive the diverted funds. Investigators said these accounts were opened using fabricated documents and were linked to shell entities and intermediaries.

The ED said around ₹187 crore belonging to the corporation had been consolidated in an account at Union Bank's MG Road branch in Bengaluru, of which approximately ₹89.63 crore was allegedly siphoned off through fraudulent transactions.

The agency has further alleged that ₹20.19 crore of the diverted funds was used in connection with the 2024 Lok Sabha election in Ballari, including alleged cash distribution. It also alleged that some money was routed to liquor traders and that gift cards worth around ₹1.40 crore were purchased.

These allegations by the investigating agencies have not been finally adjudicated by a court.

BJP Steps Up Pressure On Congress Government

Nagendra's reported decision comes amid intensified pressure from the Opposition BJP, which has been demanding his resignation and has announced a 10-day padayatra against the state government over the alleged scam.

The minister's political influence in Ballari has also featured in the political debate. The report added that Nagendra believes the BJP is apprehensive that his return to the Cabinet could strengthen the Congress in the region.

The alleged scam came to light in May 2024 after Karnataka Maharshi Valmiki Scheduled Tribes Development Corporation official P Chandrashekharan died by suicide and left behind a note alleging financial wrongdoing and pressure on officials to facilitate the transfer of corporation funds into an unauthorised account.

Nagendra, who was then the Tribal Welfare Minister, resigned the following month.