AP: Education baron arrested in Rs 547-crore scam

Andhra Pradesh police today arrested the chairman of an educational group for allegedly cheating thousands of parents after collecting deposits and taking loans to the tune of Rs 547 crore.
Five cases have been filed against N Keshava Reddy under sections 420 (cheating) and 403 (dishonest misappropriation of property) of IPC and also under the AP Protection of Depositors of Financial Establishments Act.
The Central Crime Station of Kurnool Police arrested him.
Reddy, chairman of 'Keshava Reddy Educational Institutions', allegedly collected deposits of Rs 1.5-2 lakh from parents promising them that their children would get the education free from kindergarten to Class 10 at his schools and afterwards the deposit would be returned, said Kurnool district superintendent of police Ake Ravi Krishna.

Through this scheme, Reddy allegedly collected Rs 470 crore from as many as 11,000 parents across Andhra Pradesh and Telangana where his educational group runs several institutions, the DSP said.
Reddy owes Rs 547 crore in all, which includes deposits taken from parents and loans taken from banks and individuals (mostly parents of students at his schools) by offering high interest rate.

Some of the parents had recently launched an agitation, claiming that Reddy had failed to return the deposits or the loans.
According to the preliminary probe, Reddy returned money in some cases every year by dipping into the latest incoming deposits. "We are checking the documents related to his properties in both the states," the DSP said.

According to the website of the Keshava Reddy Educational Institutions, the group was founded in 1993.