ED arrests key liaisoner in Chhattisgarh DMF scam

Raipur, Sep 2 (AHN) The Directorate of Enforcement's (ED) Raipur Zonal Office has arrested Satpal Singh Chabda under the provisions of the Prevention of Money Laundering Act (PMLA), 2002, in connection with the District Mineral Foundation (DMF) scam in Chhattisgarh.

Chabda was arrested on Tuesday and produced before the Special Court, PMLA, Raipur, which granted five days’ ED custody.

According to the ED, the investigation stems from multiple FIRs registered by the ACB/EOW, Raipur, and Chhattisgarh Police concerning the misappropriation of DMF funds.

These trusts, established in each district to benefit communities impacted by mining activities, were allegedly exploited by a syndicate of public servants, liaisoners, and vendors.

Between FY 2019-20 and 2023-24, districts received approximately Rs 9,188.20 crore under DMFT.

However, a portion of these funds was diverted by prioritising supply-oriented works, which allowed inflated pricing and commission generation, an ED statement said. A significant part of the funds was funnelled through the Chhattisgarh Rajya Beej Evam Krishi Vikas Nigam (Beej Nigam). Here, agents and liaisoners reportedly charged commissions ranging from 25 per cent to 50 per cent of the base value of purchase orders issued to Rate Contract Holder entities.

These commissions were then distributed among public servants and influential individuals to secure work orders and release payments, it said.

Chabda is alleged to have played a central role as a liaisoner and financial coordinator. He identified lucrative supply-based DMFT works, apportioned them among selected vendors, facilitated issuance of work orders, ensured payment releases, and collected commissions for distribution within the syndicate.

ED searches conducted in September 2025 under Section 17(1) of PMLA had already uncovered incriminating documents linked to the scam, said the ED press release. Further analysis of banking transactions and statements recorded under Sections 17 and 50 of PMLA revealed that Chabda received illegal commissions amounting to approximately Rs 31 crore. These funds, classified as Proceeds of Crime, were traced to accounts belonging to him, his family members, Hindu Undivided Families (HUFs), and entities under his control. Consequently, he was arrested under Section 19 of the PMLA, 2002.

The ED said that further investigation into the DMF scam is underway.