Currency exchange racket: RBI official arrested in Bengaluru

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A Reserve bank of India official was arrested along with two others on Tuesday at Bengaluru in connection with a currency exchange racket. K Micheal, a senior special assistant in the RBI was arrested for allegedly helping his friend convert demonetised high denomination notes.

[Also Read: CBI arrests hawala dealer who hid Rs 5.7 crore new notes in 'secret bathroom chamber']

CBI investigations have found that Micheal helped convert currency at State Bank of Mysore, Kollegala branch without proper documentation. The CBI said that the official helped exchange Rs 6 lakh in old currency notes with Rs 100 notes.

CBI had registered a case on December 6 against Parashivamurthy, a senior cashier of SBM in Kollegala for laundering Rs 1.51 crore for pecuniary benefits. During the course of the investigations the role of Micheal came to light.


CBI officials said that it was easier for the accused persons to source currency from the SBM, Kollegala branch. It is from this branch that currency is supplied to neighbouring SBMs. Post the decision on demonetisation, Micheal is said to have visited the branch along with his friend and exchanged Rs 6 lakh.

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