The deputy commissioner (DC) of Bengaluru district (Urban) B M Vijayashankar was arrested on Monday, July 8 by the Special Investigating Team (SIT) in the multi-crore Hala investment scam involving the Islamic investment firm IMA.

Vijayshankar was arrested on charges of allegedly taking a bribe of Rs 1.5 crore from IMA to forward a favourable report about the company to the Reserve Bank of India (RBI).

Vijayshankar is said to have received Rs 1.5 crore cash from Mansoor Khan, the founder of IMA, through village accountant Manjunath.

The SIT allegedly received specific tip-off during the interrogation of Manjunath and Bengaluru North Assistant Commissioner L C Nagaraj who was arrested last week. Nagaraj was also arrested last week on charges of a favourable report to RBI and also for allegedly taking a hefty sum of bribe.

Nagaraj, who was the competent authority entrusted with the task of investigating IMA after RBI raised the red flag highlighting the irregularities of the firm, issued a public notice seeking complaints against IMA from the public but abruptly issued a clean chit to IMA without conducting proper enquiry. A clearance certificate was provided by Nagaraj to RBI stating that no complaints were received against IMA.

Nagaraj is said to have accepted a bribe of Rs. 4.5 crores from IMA. SIT is also taken in to custody a a builder Krishnamurthy for questioning in the case.

Targeting Muslims, who as per religious diktat refuse to invest in interest-based businesses, IMA Group build a diversified portfolio encompassing bullion trading, educational academies offering pre-primary to higher secondary education, credit co-operative and housing society, health care services and a multispecialty hospital, hypermarkets and supermarkets, infrastructure and real estate development, printing and publishing and retail sales of gold, silver, diamond & platinum jewellery.

In November 2018, the Karnataka government issued a notice in Times of India (Bengaluru edition) to forfeit all movable and immovable properties of Bengaluru-based I Monetary Advisory Pvt Ltd (IMA) and its promoters and directors. IMA was found guilty of illegally collecting money from public, diverting the funds to its directors and defaulting on repayments.

Mohammed Mansoor Khan however had dismissed the notice and claimed that IMA legal team will take appropriate steps to set things right. He also said that he was deliberately done to sabotage the image of IMA group.

Despite such notices, IMA found favour with fellow faithful as it offered a bouquet of attractive investment schemes with monthly, quarterly and yearly returns. At one point of time, it doled out a 7 per cent monthly profit.