Karnataka authorities dismantle Rs 28.9 lakh fake gold loan racket

Police in Karnataka’s Shivamogga and Thirthahalli districts uncovered a coordinated fraud in which a five‑person gang pledged counterfeit gold ornaments to obtain loans from several nationalised banks and cooperative societies. The scheme duped the institutions of roughly Rs 28.9 lakh, with investigators estimating that 700 g of fake jewellery were used to secure loans ranging from ₹40 lakh to ₹50 lakh.

The Doddapete police station lodged a First Information Report and arrested one suspect, Lokesh, while the alleged mastermind, Rahul, was later taken into custody. The remaining accused — Sudha, Ravishankar and Sharath — remain at large, prompting the formation of special teams and a manhunt. Authorities say the fake gold bore only a thin coating of real metal and bore fraudulent BIS hallmark stamps to deceive bank appraisers.