ED arrests two in Fashion Gold Kerala deposit case under PMLA

What the Record Shows

The Enforcement Directorate (ED) arrested two of the accused in the Fashion Gold International deposit case, its chairman M.C. Kamaruddin and managing director T.K. Pookoya Thangal, on 8 April 2025 under the Prevention of Money Laundering Act (PMLA), 2002, according to public reports of the agency's action. The ED had earlier provisionally attached properties worth about Rs 19.62 crore linked to the group and its directors, an attachment since confirmed by the Adjudicating Authority.

The money-laundering case rests on a large body of deposit-cheating complaints registered by the Kerala Police. Per a Kerala High Court judgment dated 8 January 2025, the companies involved include Fashion Gold International Pvt. Ltd., Khamar Fashion Gold International Pvt. Ltd. and Nujoom Gold Pvt. Ltd., and the accused directors face charges under Section 420 read with Section 34 of the IPC and Sections 3, 5, 21 and 23 of the Banning of Unregulated Deposit Schemes Act (BUDS Act), 2019.

M.C. Kamaruddin's role is stated in the official record. Per a Kerala High Court bail order dated 5 February 2021, he was described as a Member of the Legislative Assembly and the chairman of Fashion Gold International Private Limited and sister concerns, and that order records he had been implicated across a large number of crimes registered in Kasaragod. Both men are accused persons in matters still pending; neither has been convicted.

How It Worked

The mechanism, as the official record describes it, was a deposit-collection business dressed as an equity opportunity. Per the Kerala High Court's 8 January 2025 judgment, the prosecution alleges that the directors induced complainants to invest by promising a monthly profit share and to return the amount whenever demanded, but that the accused did not disburse the profit share and did not return the money when depositors sought it.

Rather than being enrolled as ordinary depositors, investors were, per reporting of the case, brought in as directors or shareholders in a chain of jewellery companies and promised monthly dividends from the jewellery business, a structure that blurred the line between an investment and an unauthorised public deposit. The offering was also presented to observant savers as religiously permissible, according to that reporting; no religious figure has been named as an accused in any official action, and this report names none.

On the money trail, the ED alleges that roughly Rs 20 crore was siphoned off and that immovable property was acquired out of pooled investor funds, characterisations that remain the agency's allegations pending adjudication. The scale of the underlying complaints is reflected in the court record: per the 8 January 2025 judgment, the Public Prosecutor said huge amounts of money were collected from the general public, with approximately 170 similar cases registered against the accused. The procedural history runs from the police FIRs and the Kerala Police Crime Branch investigation to the ED's PMLA case, the attachment of assets and the April 2025 arrests, with trial in the criminal cases still to conclude.

Who Lost Money

The complainants are savers from the Kannur and Kasaragod districts of northern Kerala, a belt with deep ties to the Gulf, and reporting of the case records significant participation by non-resident Indians and Gulf returnees alongside small traders and modest household savers. The case record puts the number of formal complainants at 168, with a stated liability of about Rs 26.15 crore, while the ED has attached assets worth about Rs 19.62 crore.

The gap between the sums collected and the assets traced is the familiar arithmetic of deposit-scheme cases: what can be attached is typically well short of what depositors put in, because money has been spent or moved by the time enforcement begins. For any saver weighing a promised monthly return, comparing that promise against what a realistic rate actually produces is a useful check, and a simple lump-sum growth calculation makes the divergence plain.

What individual complainants eventually recover will depend on the BUDS Act proceedings and the disposal of the attached assets, a process that typically returns money slowly and rarely in full.

Where It Stands Now

The matters remain pending. The criminal cases registered by the Kerala Police are before the trial courts, and the ED's PMLA proceeding continues alongside them. The April 2025 arrests led, per reporting, to ED custody followed by judicial custody; an arrest is not a conviction.

The Rs 19.62 crore attachment has been confirmed by the Adjudicating Authority, which fixes the assets pending the outcome of the case rather than determining guilt. On the police cases, the official record shows the courts have engaged with bail: per the Kerala High Court order dated 5 February 2021, Kamaruddin was granted bail across the consolidated crimes on conditions, and the litigation has since moved through further appeals and applications in the High Court.

The FIRs, the prosecution complaints and the provisional attachment contain allegations, not findings of guilt; the accused are presumed innocent until proven guilty, and due process continues.

What It Means

The case is a clear illustration of how credentials can function as the product. The official record shows the prosecution itself pointing to the influence attached to public office; per the 5 February 2021 order, the prosecution argued that the applicant, being an MLA and holding an important position in a political party, wielded huge influence on the investors. Standing and trust, in this account, were what opened savers' wallets, not the economics of the underlying business.

The practical takeaway is structural rather than personal. Accepting deposits from the public in India requires specific authorisation, and the BUDS Act exists precisely to catch schemes that take public money without it. Being enrolled as a shareholder or director in exchange for a promised monthly payout is not the same as a regulated deposit, and a return that depends on continued recruitment rather than a genuine business is the pattern regulators repeatedly describe. Verifying whether an entity is authorised to accept deposits costs nothing beforehand. Readers can follow related enforcement actions through the enforcement archive.

Finally, community and faith networks deserve particular care, because the trust that makes them valuable is also what these structures exploit; a shared background is not a substitute for checking a registration, as the court record in this matter underlines.

FAQ

Does this mean the people named are guilty?

No. The FIRs, the prosecution complaints and the ED's attachment contain allegations, not findings of guilt. The directors named are accused persons in matters still pending trial and are presumed innocent until proven guilty, and due process continues.

What did the ED do in this case?

Per reports of the ED's action, the agency attached properties worth about Rs 19.62 crore linked to the Fashion Gold group, an attachment later confirmed by the Adjudicating Authority, and arrested two of the accused on 8 April 2025 under the PMLA.

What are the allegations against the directors?

Per the Kerala High Court record, the prosecution alleges the directors induced complainants to invest by promising a monthly profit share and repayment on demand, but did not pay the profits or return the money when depositors asked. These allegations are tested at trial.

Was M.C. Kamaruddin granted bail?

Yes, in the police case. Per the Kerala High Court order dated 5 February 2021, he was granted bail across the consolidated crimes on conditions. He was separately arrested by the ED in the PMLA matter in April 2025.

Where can I read the official record?

The Kerala High Court judgments dated 8 January 2025 and 5 February 2021, available on indiankanoon.org, set out the parties, the crime numbers, the statutory provisions and the prosecution's allegations. Those orders are the primary sources for this report.

This report is based on the Kerala High Court judgment dated 8 January 2025 and the Kerala High Court bail order dated 5 February 2021, together with the case record reviewed on 1 August 2026.