ED Hyderabad finds Dubai links in ₹4,000 crore AP liquor scam

HYDERABAD: The Enforcement Directorate (ED) Hyderabad zonal office on September 18 carried out search operations at 20 locations across Hyderabad, Bengaluru, Chennai, Thanjavur, Surat, Raipur, Delhi NCR and Andhra Pradesh in connection with the Andhra Pradesh liquor scam. Officials said some of the accused are hiding in Dubai.

The searches were conducted under the Prevention of Money Laundering Act, 2002 at the premises of individuals and entities accused of routing kickbacks through bogus and inflated transactions. The probe is based on a case registered by the Andhra Pradesh Crime Investigation Department (CID), which pegged the loss to the state exchequer at ₹4,000 crore.

SIT alleged brand killing, kickbacks, shell companies

The Andhra Pradesh government had set up a Special Investigation Team (SIT) on February 5, 2025 to investigate the case. The FIR alleged that between October 2019 and March 2024, under the new liquor policy, accused persons sidelined popular liquor brands such as McDowell’s, Royal Stag and Imperial Blue that refused to pay kickbacks. In their place, spurious or new brands were promoted.

SIT filed chargesheets alleging that manual approvals replaced the automated procurement system, allowing manipulation in orders for supply. They allegedly forced suppliers to pay 15–20% of their invoice value as kickbacks. Shell distilleries and fake vendors allegedly inflated volumes, manipulated brand approvals, suppressed dissent, and diverted funds for elections, personal gain, and overseas transfers.

ED finds Dubai links, seizes cash and incriminating records

According to ED, Andhra Pradesh State Beverages Corporation Limited routed payments to suppliers through shell entities under the pretext of supplying goods and services. Authorities found that many of these entities were non-existent or unrelated, while some transactions inflated. Suppliers allegedly diverted funds to jewellers to purchase gold and cash, which they then handed over as kickbacks.

Searches led to the recovery of bogus invoices, parallel billing with inflated prices, transport challans containing fake vehicle details and chats pointing to accused persons now hiding in Dubai. Authorities seized unaccounted cash of ₹38 lakh, along with ledgers indicating remittance of proceeds of crime worth several crore abroad.