Following raids on the Vijaya Vauhini studios and other companies owned by the group, the CBI unearthed a major scam running into over Rs 30 crore in what the agency calls `kite flying' banking transactions, and is reportedly probing the role of the group's directors.

The first information report registered by the CBI said the executives had issued 16 cheques for Rs 13.94 crore and encashed them though their accounts did not contain sufficient funds.

Opposing their anticipatory bail, the CBI said the five had opened several accounts in various banks, including the Thyagaraya Nagar branch of the State Bank of Mysore and issued cheques for huge amounts from 12 of their 27 accounts withoutsufficient credit balance.

The modus operandi in the transactions was said to be that the directors would issue cheques from the State Bank of Mysore, T Nagar branch, and place them for credit in the Vijaya Bank.

The cheques would be presented despite funds not being available in their accounts in the State Bank of Mysore. On the same day of the cheque being presented, demand drafts or other bills (for which they were not eligible) would be raised at Canara Bank. The next day, apparently unaccounted money would be deposited into their account in the State Bank of Mysore.

Thus, black money was sought to be converted into white money, the CBI charged. Such transactions have also been carried out in a few financial institutions, including the Egmore Benefit Fund and a Housing Finance group, the CBI alleged, over six to nine months.

Over 60 per cent of the money was allegedly siphoned off to various countries in Europe, including Scotland, by one of the directors and invested in these countries for otherbusinesses, the CBI charged.

The CBI has also listed as accused some bank officers, and seized vital documents pertaining to the transactions, including cheque leaves for more than Rs 70 lakh from all the three banks during the raids.

The CBI interrogated company auditor Neelakantan and seized some documents from him during the ongoing raids, sources said. According to sources, there were claims regarding Income-Tax arrears and Central Excise arrears of the group running into several crores.

Submitting that they were not directly involved with the daily running of the firms, the five executives argued that there was no intention on their part to cheat the banks.

Justice R Balasubramaniam posted further hearing in the case for tomorrow.