Medical seat-blocking 'scam': ED raids 16 locations in Telangana, seizes Rs 1.4 cr cash

The Enforcement Directorate (ED) recently conducted searches at 16 locations in Hyderabad, Khammam, Karimnagar, and other places across Telangana in connection to a money laundering case linked with an alleged medical seat-blocking scam, officials said on Thursday.

The search operations led to the seizure of incriminating documents, digital devices, and records of cash transactions amounting to hundreds of crores of rupees, collected from PG medical candidates as well as MBBS students allegedly for seat-blocking.

The agency has also recovered and seized unaccounted cash amounting to Rs 1.4 crore from the premises of Malla Reddy Institute of Medical Sciences in Hyderabad.

During the search, the ED also froze Rs 2.89 crore in a bank account of Malla Reddy Institute of Medical Sciences, where the cash collected for medical PG admissions was suspected to be deposited.

The medical college, run by Malla Reddy Group of Institutions, is being operated by the family of Telangana Labour Minister Malla Reddy.

The ED initiated the case in February based on an FIR registered by the Matwada Police in Telangana, following a complaint filed by the former Registrar of the Kaloji Narayana Rao University of Health Sciences (KNRUHS) against unknown individuals.

It was alleged that certain agencies were involved in seat-blocking in collaboration with students and private institutions in Telangana and other states, and in acquiring the necessary documents from candidates for registration under KNRUHS.

"During the ED's investigation, the university discovered that five candidates had stated they had not even applied for counselling with the KNRUHS. The seats were blocked using the credentials of high-scoring PG NEET candidates from other states. After the mop-up round of counselling and the last date of admission, these seats were reported to the university as vacant and were declared as stray vacancies. The university then allocated these seats to respective private medical colleges for admission under the management and institutional quota. Subsequently, these seats were sold at exorbitant premiums ranging anywhere between Rs 1-2.5 crores," officials said.

They added that the university had implemented penalties for defaulting candidates to address the issue of seat-blocking. However, the ED investigation revealed that the penalty was being paid on behalf of the seat-blocking candidates using the premiums collected from the sale of PG Medical seats.

The ED has conducted searches at the corporate office of Prathima Group at Film Nagar in Hyderabad. It also carried out searches at Prathima Medical College and Prathima Multiplex in Karimnagar.

Besides, searches were also conducted at Chalmeda Ananda Rao Medical College in Karimnagar, Kamineni Medical College in Hyderabad, SVS Medical College in Mahabubnagar, and MSR Medical College in Sangareddy.

Further investigation into the matter is ongoing.