Andhra liquor scam: Former CM Jagan one among those who received kickbacks from distillery companies, says CID remand report
Police named about 40 persons, including a retired IAS officer, officers of Andhra Pradesh State Beverages Corporation Limited (APSBCL), one MP, former MP, public representatives and others as accused in the scam.
'Accused No.1 Kessireddy Rajashekar Reddy collected the kickbacks and routed to Accused No.4 P.V. Midhun Reddy, Accused No.5 V. Vijaya Sai Reddy and Balaji Govindappa (A-33) before the kickback amount reportedly reached the then Chief Minister,' police investigating the case said in the Midhun Reddy's remand report.
'Kickback negotiations began at 12% and escalated to 20% of the base price. The distillery companies were threatened from business exclusion, if they did not comply with the demands of the liquor syndicate,' as per the report.
During investigation, it was revealed that the syndicate members including Kessireddy Rajashekar Reddy, Avinash Reddy alias Sumith (A-7 and co-brother of Kessireddy), MP Midhun Reddy, V. Vijay Sai Reddy (A-5) met on September 13, 2019, at the house of Mr. Vijay Sai Reddy, located at Jubilee Hills, in Hyderabad. Then APSBCL Managing Director D. Vasudeva Reddy (A-5) and D. Satya Prasad (A-3) presented three years liquor sales and other particulars.
After analysing the sales reports and the related documents, the accused deduced that they could earn nearly ₹50-60 crore per month through commissions or kickbacks from the liquor suppliers.
Under Andhra's new liquor policy, 180 ml of any brand to be sold at ₹99
In the meeting, the syndicate members decided that Mr. Satya Prasad will handle the supplies at the liquor depots and sales at the Government Retail Outlets to bypass the automatic order for supply.
The kickbacks were disguised through inflated transactions with bullion merchants and shell companies. Bank records show funds routed through entities such as SPY Distilleries (a brand promoted by the accused), Sanhoc Labs and D-Cart Logistics.
To facilitate the payments made through kickbacks or commissions, the distillery companies followed several methods of cash generation from the funds credited by the APSBCL into their accounts. 'They [liquor suppliers] colluded with gold merchants and supplied gold to the accused. Suspicious transactions, worth nearly ₹300-400 crore have been identified from the bank statements of the distillery firms,' the CID officials stated in the report.
For collecting kickbacks, the accused established a private network by attracting gullible young graduates including several IIT personnel to act as collection agents (or) mules for making VoIP calls by impersonation and luring them with white collar jobs in the shell companies floated by the syndicate, as per the report.
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