The Enforcement Directorate (ED) has intensified its investigation into the alleged ₹3,500 crore Andhra Pradesh liquor scam, conducting searches at approximately 20 locations across multiple states. The searches, carried out on Thursday, spanned Telangana, Andhra Pradesh, Tamil Nadu, Karnataka, and the Delhi-NCR region.

The investigation is focused on unearthing evidence related to money laundering, with authorities scrutinizing entities and individuals suspected of facilitating kickbacks through fraudulent and inflated invoices. The ED's action is based on a First Information Report (FIR) filed by the Andhra Pradesh Police's Special Investigation Team (SIT).

The case revolves around alleged irregularities in the state's liquor policy during the previous YSR Congress Party (YSRCP) regime. The SIT's investigation suggests that kickbacks of ₹50-60 crore per month were generated after the 2019 liquor policy brought state-run outlets under the Andhra Pradesh State Beverages Corporation Limited (APSBCL). The policy was reportedly finalized in a meeting chaired by the then Chief Minister YS Jagan Mohan Reddy, although he has not been named as an accused.

According to the police chargesheets, the alleged illicit funds were laundered through low-profile employees and office staff, with some receiving the cash as "salary" before transferring it to others. Former special chief secretary for excise, Rajat Bhargava, reportedly alerted the Chief Minister's Office about the irregularities but was allegedly ignored. The YSRCP has refuted the allegations, dismissing them as baseless.

The ED's searches targeted premises linked to several entities, including Arete Institute of Medical Sciences, Shree Jewellers Eximp, NR Udhyog LLP, The India Fruits Pvt. Ltd. (Chennai), Venkateshwara Packaging, Suvarna Durga Bottles, Rao Saheb Boorugu Mahadev Jewellers, Ushodaya Enterprises, and Mohan Lal Jewellers (Chennai). In Hyderabad, raids were conducted at the residence of businessman B. Ramesh and his son Vikranth, who are suspected of setting up shell companies in Karnataka and other locations for transactions with the accused.

The SIT's investigation revealed that 16 liquor companies allegedly paid ₹1,677 crore in bribes to secure supply orders worth ₹10,835 crore from APSBCL between 2019 and 2024. During the YSRCP government's tenure, APSBCL reportedly issued orders worth ₹23,000 crore, with over 90% going to just 40 of the 111 registered firms. Investigators allege that distilleries diverted large sums under the guise of raw material purchases and brand promotions after APSBCL released payments. These funds were then allegedly withdrawn in cash and paid out as kickbacks.

The ED has registered a case under the Prevention of Money Laundering Act (PMLA) and has been summoning various companies and individuals for questioning. The agency has also recorded statements from several distilleries linked to the case and questioned prime accused Raj Kasireddy, who is currently in judicial custody. YSRCP Lok Sabha MP PV Midhun Reddy has already been arrested in connection with the case. A special court in Vijayawada has extended the judicial remand of eight accused in the case until September 26.