The Central Crime Branch (CCB) charged Reddy with shielding a father and son, accused in the Rs 954 crore Ponzi scheme, from being investigated by the Enforcement Directorate (ED) for alleged money laundering in violation of the Foreign Exchange Management Act (FEMA).
His arrest comes a day after he (Reddy) drove to the CCB office on Saturday evening in response to its summons in the Ponzi case.
Reddy was quizzed on Saturday by CCB officials led by Alok Kumar, Deputy Commissioner of Police (DCP) S. Girish and Assistant Commissioner of Police (ACP) Venkatesh Prasanna.
The CCB also arrested Reddy’s aide Ali Khan, who had allegedly struck Rs 18 crore deal with the accused, Syed Ahmed Fareed and his son Syed Afaq Ahmed of Ambidant Marketing Ltd, a city-based company that ran the Ponzi scheme and duped about 15,000 investors by laundering their money from Dubai.
Reddy, a former BJP Minister in the state (2008-11), however, denied his involvement in the case.
“I have no role in the Ponzi scheme. The police have no evidence to prove my involvement in it. They (police) are misleading the media and the public,” said Reddy in a video clip released to local news channels before his interrogation on Saturday.