Beyond Rs 140 crore: Mudra Co-op scam that preyed on dreams
Hyderabad: What began as a promise of a government-backed financial security has unraveled into one of Telangana’s most elaborate financial frauds, with investigators now tracing a network of deceit that spans over 330 branches across two Telugu states and involves Rs 140 crores in alleged embezzlement. Masquerading as a government-backed initiative, misusing the central government’s ‘Pradhan Mantri Mudra Yojana’ and promoting a non-existent state-level scheme called ‘KCR Sahakara Runa Bhavanam’ to lure depositors are some of the key findings related to the Mudra cooperative society scam.
The Central Investigation Department (CID) is now meticulously mapping the financial trails of the cooperative society. The police describe it as a ‘well-planned financial fraud’ that has caused irreparable loss to hundreds of innocent victims.
Delving deeper into specifics, the scam allegedly was masterminded by Thippeneni’s family, including the couple Thippeneni Ramadasappa Naidu, who was the chairman of the society, and his wife T. Prameela, and their children, son Thippeneni Sai Kiran and daughter T. Pavani Kumari.
The accused operated under the name Mudra Cooperative Society, allegedly misusing the identity of the central government’s Pradhan Mantri Mudra Yojana. This legitimate loan program facilitates microcredit of up to Rs. 20 lakhs for small businesses in the non-farm sector. Additionally, they invented a fictitious state-level scheme called the ‘KCR Sahakara Runa Bhavanam,’ evoking the initials and political brand of former Chief Minister and Bharat Rashtra Samithi (BRS) party president K. Chandrashekar Rao.
The accused Chairman Thippeneni Ramadasappa Naidu published advertisements in Telugu newspapers offering 2,000 government marketing supervisor jobs. Believing these advertisements to be true, many from Telangana and Andhra Pradesh applied, said the CID police.
According to the CID, which made arrests on 29 July 2025 after over a five-year investigation, the group established the cooperative society named Mudra Agriculture Skill Development Multi-State Co-Operative Society Limited, with criminal intent. They mimicked the central government’s Pradhan Mantri Mudra Yojana scheme and falsely promoted it as a government-backed initiative. They enticed farmers and unemployed youth by promising jobs and high-interest returns on deposits, luring depositors with promises of high returns and jobs.
Job promises turn to nightmare
In one instance, a victim approached Ramadasappa Naidu in Barkatpura and was offered a job in exchange for Rs 1,50,000. After paying the amount, the victim was appointed as an administration officer in the Kandukur branch of Ranga Reddy district. Naidu falsely claimed the society would soon become a government bank and even instructed the display of former Chief Minister K. Chandrashekar Rao’s (KCR) photo on the board as he obtained permission to enhance credibility. After two years, when the victim inquired about the promised bank and requested a refund, he received no response and eventually filed a police complaint.
Another victim paid Rs 90,000 and submitted his original certificates to secure a cashier position in 2017. He received an appointment letter and was promised a salary of Rs 20,000 per month, along with the assurance that the society would turn into a bank within two years. Initially, he received a meagre salary of Rs 4,000, which was later increased to Rs 8,000.
Further, the victim along with other employees were given targets to collect deposits from farmers and started harassing the employees physically and mentally. If they fail to finish the targets, the chairman will cut their salaries without any reason. They used to collect deposits by posting flexes and stating that this society is related to the “Pradhan Mantri Mudra Yojana.” He was also assigned targets to collect deposits from farmers under false pretenses, such as displaying flexes linking the society to the Pradhan Mantri Mudra Yojana.
When the victim resigned from his job and requested the return of his Rs 90,000 deposit and original certificates, Chairman Ramadasappa Naidu threatened him, demanded Rs 10 lakh, and warned of filing criminal cases.
Hidden depths: Gold mortgaged, lives lost
Over 330 branches opened, close to 1600 employees were recruited, beyond 2000 victims cheated and the estimated fraud amount, Rs 140 crores are the statistics released by CID. However, retired High Court Judge Justice B. Chandra Kumar, who has been advocating on behalf of victims of the Mudra cooperative society scam, revealed that the scale of the fraud now appears to exceed Rs 1,000 crores, significantly higher than official estimates.
According to Kumar, the scheme affected approximately 4,000 members each from Telangana and Andhra Pradesh, with the accused collecting between Rs 2 and Rs 5 lakhs from each individual. The operation followed a familiar pattern, open a branch abruptly, recruit members by collecting large sums, and then shutter the location without returning the funds.
Many victims, having mortgaged gold ornaments and taken high-interest loans to raise the required deposits, were left in severe financial distress when the society abruptly terminated their jobs and failed to return their money. The dual burden of unemployment and mounting debt led to extreme desperation. Kumar confirmed there have been multiple instances where victims died by suicide.
In a further disturbing development, Justice Chandra Kumar alleged that the accused forged his signature to influence some people. He has filed a formal complaint regarding the forged signature with the LB Nagar police station of the Rachakonda commissionerate.
The investigation is at a crucial stage, involving the mapping of financial trails, scrutiny of bank accounts, identification of beneficiary networks, and examination of additional witnesses. Further, the material part of the investigation has been completed and 227 witnesses have already been examined.
The CID probe revealed that a significant portion of the embezzled funds was funneled in M/s APIIC Limited for acquiring industrial plots in Andhra Pradesh in his name and that of his family members. Further, the accused also violated the bylaws of the society for his wrongful gain.
The interim forensic audit report of the society’s operations confirmed the scam. Further, the report revealed that T. Pavani Kumari misappropriated Rs. 65,08,509 and T. Prameela misappropriated Rs. 9,18,100 from society funds.
The accused retained original educational certificates and collected amounts under the guise of share capital and investment bonds instead of fixed deposits. Employees were given targets to collect deposits from farmers, and when they failed, the amounts were deducted from their salaries, said the CID in a statement.
Several employees who resigned were denied the return of their certificates and investments. If they resisted, the accused threatened them with negative coverage in the ‘Margadarshi’ newspaper, falsely alleging links with anti-social elements. He also took signatures on blank white papers and withheld salaries.
People are requested not to believe in fraudulent financial companies without having permission from RBI, promising unbelievable return rates and not to invest their hard-earned money into such schemes.
