TDP MLA Atchannaidu arrested by ACB for alleged involvement in ESI scam

The Anti-Corruption Bureau (ACB) officials in Andhra Pradesh, on Friday, arrested former minister and Telugu Desam Party (TDP) deputy floor leader in the State Assembly Kinjarapu Atchannaidu for his alleged involvement in the Employees State Insurance (ESI) scam. Former directors of Insurance Medical Services (IMS), Dr CK Ramesh Kumar and Dr Vijay Kumar, were also taken into custody by the ACB officials.

The ACB officials were flanked by the local police while Atchannaidu was arrested from his residence in Nimmada village, Kotabommali mandal, Srikakulam district on Friday morning. The TDP MLA has been taken to Vijayawada where he will be produced before ACB Special Court.

Reacting to the arrest of K Atchannaidu, TDP President N Chandrababu Naidu slammed the YSRCP

government. Calling it a “kidnap” by over a hundred policemen, the former Chief Minister said the act is an “attack on the backward classes”. Several other TDP leaders, including the party’s General Secretary Nara Lokesh, have criticised the government over the arrest of their senior leader.

In February this year, the Vigilance and Enforcement Department of Andhra Pradesh claimed that they discovered a scam worth Rs 404.86 crore in the Employees State Insurance (ESI) Corporation between 2014 and 2019 when the Telugu Desam Party was in power. It may be recalled that Atchannaidu was serving as the Minister for Labour during this period. However, the TDP leader denied his involvement in the scam back then and stated that he duly implemented the schemes as per the Centre’s directives. The leader even claimed that all records pertaining to the allegations were readily available and are up for verification.

As per the vigilance department, gross irregularities occurred during the purchase of medicines, drugs, furniture, lab kits, surgical items between 2014-15 and 2018-19. These irregularities caused a loss of more than Rs 151 crore to the state’s exchequer, the officials said. They stated that the purchases cost Rs 975.79 crore during this period, and the three directors responsible for the purchases violated all procedures and guidelines of the State Government and ESIC.

The officials exceeded the budget of Rs 293.51 crore and overspent, violating the procedural guidelines. The report further stated that of the amount spent, Rs 51 crore was paid in excess because the drugs were procured from non-rate contract firms. It also claimed that the officials involved paid an excess of Rs 85.32 to three private firms for purchasing laboratory kits and another Rs 10.43 crore on surgical items.