In a shocking revelation, the Enforcement Directorate (ED) has uncovered a massive stipend scam at Mahadevappa Rampure Medical College (MRMC) in Kalaburagi, Karnataka. The investigation, initiated in 2025, suggests that at least Rs 30 crore was siphoned off from stipend amounts allocated for postgraduate students over six years. Raids conducted on properties linked to MRMC have exposed a systematic scheme that exploited vulnerable students, raising serious concerns about financial oversight in educational institutions.
Background of the Case
The probe began with a First Information Report (FIR) filed at the Cyber, Economics, and Narcotics (CEN) Cell in Kalaburagi, alleging that Rs 81.21 crore, intended as stipends for 282 postgraduate students from January 1, 2018, to March 1, 2024, was misappropriated. The FIR pointed to collusion between college officials and a bank manager, prompting the ED to launch a detailed investigation under the Prevention of Money Laundering Act (PMLA) (The Indian Express).
Details of the Investigation
Between April 30 and May 3, 2025, the ED conducted raids at seven locations associated with MRMC, including the residences of key figures. The operation uncovered electronic records, such as Excel sheets detailing blank signed cheques collected from students and cash withdrawals made by the college management. These findings indicate that at least Rs 30 crore was diverted from the stipend funds, with the total misappropriated amount potentially reaching ₹81.21 crore (ProKerala).
| Investigation Details | Information |
|---|---|
| Agency | Enforcement Directorate, Bengaluru Zonal Office |
| Raid Dates | April 30, May 1, May 3, 2025 |
| Locations Searched | 7, including residences of key accused |
| Evidence Seized | Electronic records, Excel sheets with cheque and withdrawal details |
| Total Amount Alleged | Rs 81.21 crore for 282 students |
| Confirmed Siphoned | At least Rs 30 crore |
Key Individuals Involved
The investigation has implicated several prominent figures:
- Bhimashankar Bilgundi: Former president of the Hyderabad-Karnataka Education Society (HKE), accused of orchestrating the scam.
- Dr. S.M. Patel: Former dean of MRMC, allegedly involved in operational aspects of the fraud.
- Subhash Chandra: MRMC accountant, accused of managing illicit financial transactions.
- Canara Bank Manager: The manager of Canara Bank’s MRMC branch, suspected of facilitating unauthorized withdrawals (The Hindu).
These individuals allegedly exploited their authority to manipulate students’ stipend accounts, diverting funds for personal gain.
Method of Misappropriation
The scam operated through a coercive mechanism where postgraduate students were pressured to provide blank signed cheques upon enrollment. These cheques were used to withdraw significant portions of the stipends once credited, leaving students with as little as Rs 8,000-Rs 12,000 per month instead of the mandated Rs 45,000-Rs 55,000. This practice, spanning from 2018-19 to 2023-24, allowed the accused to siphon off millions while maintaining the appearance of compliance with stipend disbursements (Medical Dialogues).
Impact on Students
The financial misconduct has had a devastating effect on MRMC’s postgraduate students, who rely on stipends to cover living expenses and educational costs. Reports from early 2024 indicate that students launched a strike, alleging that the college management systematically withdrew funds, leaving them with insufficient resources. The reduced stipends impacted their academic performance and mental well-being, prompting demands for accountability (EdexLive).
| Student Impact | Details |
|---|---|
| Affected Students | 282 postgraduate medical students |
| Stipend Entitlement | Rs 45,000-Rs 55,000 per month |
| Received Amount | Rs 8,000-Rs 12,000 per month |
| Period | 2018-2024 |
Legal Proceedings and Next Steps
The ED has registered a case under the PMLA and is actively analyzing seized evidence to trace the money trail. Potential charges include fraud, misappropriation, and money laundering. The agency aims to identify additional accomplices and recover the siphoned funds. The case may lead to broader reforms in how educational institutions manage student finances, with calls for stricter oversight to prevent similar incidents (Daijiworld).
Reactions and Statements
The academic community in Kalaburagi has expressed outrage over the scandal, with student unions and local activists demanding transparency. As of May 6, 2025, no official statements have been released by the accused or MRMC’s current administration. However, earlier responses from the college, during a 2024 student strike, included assurances of full stipend payments and investigations into past withdrawals, though students described these as “half-positive” (EdexLive).
(India CSR)
