Hyderabad: The Anti-Corruption Bureau (ACB) has confirmed a ₹600 crore Formula E race scam, stating it involved a quid pro quo arrangement planned by former minister K.T. Rama Rao and senior IAS officer Arvind Kumar.
The ACB found that an unrelated agency, HMDA, signed multi-year contracts worth ₹600 crore for four racing seasons. These agreements were routed through MAUD and private organisers with plans to gain kickbacks in return. The strategy reportedly collapsed after the change in government.
ACB lists KTR and Arvind Kumar as key accused
In letters sent to the Speaker, Chief Secretary, and Vigilance Commissioner on Tuesday, the ACB sought permission to prosecute KTR, who is currently an MLA. The agency accused him of violating the election code by transferring ₹58.89 crore from HMDA funds to foreign accounts during the Assembly polls.
According to the final report, submitted after an eight-month probe, the scheme involved ten accused. Besides KTR and Arvind Kumar, HMDA’s former Chief Engineer B.L.N. Reddy, organisers from Ace NextGen, and representatives of London-based Formula E Operations were also named.
The report includes 78 pages and over 1,000 documents. It covers government orders, fund transfers, and penalty payments made to the Income Tax department due to RBI violations. The ACB noted a misuse of ₹54.88 crore before the plan was halted.
Greenko donations linked to BRS via electoral bonds
Investigators found that Greenko, whose founder Chalamalasetty Anil Kumar played a role in the event planning, donated ₹41 crore to the BRS through electoral bonds. These transfers happened in April and October 2022, coinciding with the creation of Ace NextGen.
In February 2023, Season 9 of the race took place in Hyderabad. However, disputes soon emerged between organisers. When dues went unpaid, Formula E Operations halted future events. Despite this, KTR directed officials to sign a new deal in October 2023, committing ₹160 crore from HMDA during the election code period, without EC approval.
These transactions included ₹45.71 crore sent in foreign currency to Formula E Operations on October 3 and 11, 2023. The IT department later fined HMDA ₹8.07 crore for the unauthorised transfers.
Multiple rounds of questioning were conducted
The ACB registered an FIR on December 19, 2023, following a complaint from then Principal Secretary Danakishore. It formally charged KTR as the main accused. Arvind Kumar and B.L.N. Reddy were also named for misusing HMDA funds under political orders.
ACB questioned Arvind Kumar on January 8, KTR on January 9, and B.L.N. Reddy the next day. It later summoned Anil Kumar from Ace NextGen and re-questioned KTR in June. Virtual inquiries were also held with officials from Formula E Operations in London.
During interrogation, most accused cited KTR’s instructions as the basis for proposals, contracts, and fund transfers. The ACB documented these statements and gathered supporting material for court proceedings, which will begin once the government grants formal sanction.
