ED conducted searches at 12 private medical colleges and offices in case of PG Medical Seat Blocking Scam

The Directorate of Enforcement (ED) conducted searches at 16 locations in Hyderabad, Khammam, Karimnagar and other places across Telangana under the provisions of the Prevention of Money Laundering Act (PMLA) on 21.06.2023 in connection with PG Medical Seat Blocking Scam.

Earlier in February 2023, the ED recorded a case of money laundering based on a FIR registered by the Matwada Police, Warangal on a complaint filed by the then Registrar of the Kaloji Narayana Rao University of Health Sciences (KNRUHS) against unknown persons alleging that some agencies are involved in seat blocking in collusion with students / private institutions in Telangana & other states and in obtaining relevant documents of candidates required for registration.

ED investigation indicated that after its own enquiries, the University discovered five candidates who stated that they had not even applied for counselling with the KNRUHS.

The ED investigation also revealed that seats were blocked using the credentials of high-scoring PG NEET candidates from other states, and that after the mop-up round of counselling and the last date of admission, the seats were reported to the University as vacant, and that such vacant seats were declared by the University as stray vacancies and given to the respective private medical colleges for admission under the management/institutional quota.

These seats were then sold off at exorbitant premiums ranging anywhere between Rs.1-2.5 Crores.

To curb the menace of seat blocking, the University had provisioned penalty on the defaulting candidates. However, ED investigation revealed that penalty was being paid by/on behalf of the seat blocking candidates out of the premium collected for sale of the PG Medical seats.

The search operations resulted in the discovery of incriminating papers, digital devices, and records of financial transactions totaling hundreds of billions of rupees related to the collecting of cash fees and premiums from both PG medical aspirants and MBBS students.

In addition, unaccounted cash totaling Rs. 1.4 crore was collected and confiscated from the Malla Reddy Institute of Medical Sciences premises. During the search, the ED also placed a hold on Rs. 2.89 crore in a bank account of Malla Reddy Institute of Medical Sciences, where cash received for medical PG admissions was alleged to have been put.

Further investigation in the matter is under progress.