THIRUVANANTHAPURAM: The Enforcement Directorate has served a show-cause notice on Chief Minister Pinarayi Vjayan over the alleged violation of FEMA rules in the masala bond issue by the Kerala Infrastructure Investment Fund Board (KIIFB).

Former Finance Minister Thomas Isaac and KIIFB CEO KM Abraham also received notices.  The chief minister is the chairperson of the KIIFB, a body corporate established by the state government to fund major infrastructure development projects. Isaac was the finance minister in 2019 when the KIIFB raised Rs 2150 crore through masala bonds. Abraham also holds charge of Chief Minister’s Chief Principal Secretary. In the notice, the ED hasked the trio to give their explanations to the adjudicating authority.

The notice alleged that the money raised through masala bonds were illegally used for infrastructure development. According to Isaac, the show cause notice is a gimmick orchestrated by the BJP-led union government eyeing the upcoming elections.

“The RBI restricts purchase of land using masala bond funds. A portion of the funds were used to acquire land for a KIIFB project. However, this was made before the RBI restriction came into effect,” he told media persons here on Monday.