ED Flags ₹1,020-Crore Tender Scam in Tamil Nadu MAWS Dept, Minister Under Lens

ED Flags Massive Tender-Rigging Scam in Tamil Nadu’s MAWS Department, Cites ₹1,020 Crore in Alleged Kickbacks

A sweeping corruption disclosure by the Enforcement Directorate (ED) has escalated into a significant institutional standoff in Tamil Nadu, after investigators detailed what they described as a systemic network of bribes, pre-fixed tenders and kickbacks within the Municipal Administration and Water Supply (MAWS) Department. The agency’s 258-page dossier alleges that more than ₹1,020 crore may have been generated through manipulated municipal contracts, implicating officials and associates linked to Minister K.N. Nehru.

The ED has formally urged the state police and anti-corruption authorities to register a criminal case — a prerequisite for pursuing money-laundering charges.

ED Flags “Systemic” Bribe Network in Municipal Tendering

The April searches at properties linked to Minister Nehru and his associates were initially part of an unrelated case. But digital records allegedly uncovered during the operation — including WhatsApp chats, internal spreadsheets, and communication logs — triggered a new investigation thread.

According to the dossier submitted on December 3, the ED claims:

• Bribes ranging from 7.5% to 25% of contract values were allegedly collected

• Payments were reportedly routed through contractors, intermediaries and officials

• Tenders were allegedly pre-determined or manipulated to benefit preferred firms

• Funds were allegedly used to finance personal assets, lifestyle spending, and political activities

The agency alleges that the pattern was consistent across multiple project categories, including sanitation outsourcing, community toilet construction, village roads, NABARD works, and lake-restoration contracts.

Investigators also cite recovered messages which they claim show “party fund” discussions and pre-fixed tender outcomes.

Jurisdiction Debate: ED Seeks FIR, State Yet to Respond

Under the Prevention of Money Laundering Act (PMLA), the ED cannot prosecute money laundering unless a predicate offence is registered by police or an anti-corruption authority. Using Section 66(2) of PMLA, the agency has forwarded the evidence to the Tamil Nadu Chief Secretary, DGP, and DVAC, urging immediate FIR registration.

The dossier reminds state authorities of the Supreme Court’s interpretation of PMLA, which cautions that ignoring actionable evidence could be construed as “knowingly assisting” in the generation of illicit proceeds.

This is not the first time the ED has flagged concerns to state authorities. In the past two years, the agency sent multiple communications relating to alleged:

• River sand mining irregularities

• Cash-for-jobs schemes within MAWS

• Hiring-related bribery allegations

State authorities have yet to publicly confirm whether they will register a case in the current matter.

Parallel Corruption Cases Add Pressure on the System

The MAWS allegations come on the heels of several recent corruption probes in Tamil Nadu’s public works and housing sectors. In 2025, the ED shared evidence of a ₹27.9 crore payment allegedly involving former housing minister R. Vaithilingam. DVAC had already filed two FIRs in that case, enabling the ED to proceed under PMLA.

However, in the MAWS investigation, the absence of an FIR poses a procedural barrier. ED claims the ₹1,020-crore tender scheme is supported by:

• Electronic calculation logs

• Contractor payment charts

• Internal correspondence suggesting coordinated bribe collection

• Records indicating involvement of officials across multiple administrative levels

The alleged money flow includes both formal channels and informal hawala routes.

Political Sensitivities and Institutional Friction

Minister Nehru and MAWS Principal Secretary D. Karthikeyan have not commented on the latest allegations. State leadership remains cautious, balancing legal considerations, political risk, and administrative complexities.

The tension reflects a broader national trend — federal agencies pushing for predicate offences while state governments push back over perceived intrusions into their jurisdiction.

ED officials assert that evidence from April’s searches, originally linked to a separate case involving a company associated with the minister’s brother, warrants immediate state-level action. That earlier case was closed after the Madras High Court quashed the underlying CBI investigation, leaving the new material as the basis for fresh inquiry.

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