Bhubaneswar, March 29: The Economic Offences Wing (EOW) of the Crime Branch today arrested the personal assistant to the state panchayati raj secretary on charges of issuing an official letter without authorisation in favour of a tainted company.

The director of Microfinance Ltd, a non-banking financial company, was also held.

EOW officials said Ajay Swain, during his stint as personal assistant to the commissioner-cum-secretary, panchayati raj, had issued a letter in a departmental letter pad to all district collectors not to take action against Microfinance Ltd, a non-banking finance company, and allow its business since it had got prior permission from the state government.

Later, the panchayati raj department lodged a complaint with the investigating agency yesterday.

Subsequently, both of them were arrested.

“Swain had put his signature on the letter and had sent it to all district collectors,” said deputy inspector general, EOW, Rajesh Kumar.

The EOW also arrested Baikuntha Patnaik, the director of Microfinance Ltd.

The police said Swain had been suspended on March 27 following a departmental inquiry into the incident which found him guilty.

Sources said the Reserve Bank of India had restricted the company from carrying out monetary transactions in 2012 but the company officials had tried to influence the district administrations to run their transaction through this letter.