In a major revelation tied to the liquor scam, investigators have found that black money was funnelled into the Telugu film industry to convert it into white. Key accused Raj Kesireddy established a production company named ED Entertainments during the YSRCP regime and produced two films: Malli Modalaindi, starring Sumanth, and SPY, starring Nikhil Siddhartha.
Though the company claimed to have spent only ₹12 crore (raised via loans), the SIT found that nearly ₹40 crore in unaccounted cash was used. Records were falsified, and funds collected as kickbacks from distilleries and liquor suppliers were routed into ED Entertainments’ account under the guise of personal loans. In one case, the wife of a leading pan-India actor transferred ₹1 crore to the company but never received it back.
The SIT concluded that ₹28 crore was spent off the books, mostly in cash. Despite both films underperforming at the box office, they were sold via OTT and satellite rights for around ₹36 crore, effectively laundering black money through film production.
Raj Kesireddy established ED Entertainments in December 2020 under Jagan’s rule. The company was gearing up for larger productions and had even paid advances to several young directors. But following YSRCP’s fall from power and an intensified probe into the liquor scam, the plans were shelved and the team went underground. The SIT is preparing to submit its full findings to the court.
