The Enforcement Directorate (ED) on Saturday attached Karvy shares worth Rs 700 crore under the Money Laundering Act. The ED said that all the banks of Karvy have filed complaints under CCS and Cyberabad limits. The shares were frozen following raids against Karvy Stock Broking Limited (KSBL) CMD C Parthasarathy and others. The ED further said that Karvy pledged shareholders' shares with banks and took a loan of Rs 2,873 crore which is against the provisions and the loans were subsequently transferred to individual accounts. 

Karvy's CMD Parthasarathy is currently lodged in Chanchalguda jail after being arrested by the police last month. The ED had raided six places in Hyderabad on 22 September. Karvy is a financial services company in India. It is involved in the distribution of financial services such as equities, commodity trading, depository and wealth management services and other financial products. In November 2019, the Securities and Exchange Board of India (SEBI) barred Karvy Stock Broking Ltd from buying shares in delivery and accepting new clients pending forensic audit. 

SEBI found that Karvy had defaulted investor funds to the tune of Rs 2000 crore by pledging securities of its clients. The action was based on a detailed report of the National Stock Exchange. The company had sold additional securities (not available in their DP account) worth Rs 485 crore through nine related clients till May 31, 2019. He transferred additional securities worth Rs 162 crore to six of these nine related clients till May 31, 2019. It subsequently tried to buy back securities worth Rs 228.07 crore to meet the shortfall between June-September 2019. An amount of 1096 crores was transferred to its group concern Karvy Realty Pvt Ltd during the period April 2016-October 2019.

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