₹590 Crore IDFC First Bank Fraud Case: 11 Arrested, SIT Probing Shell Companies and Government Fund Diversion

Chandigarh: A major financial fraud case involving government funds has come to light at IDFC First Bank, where investigators allege that hundreds of crores were siphoned off using fake companies and forged banking documents. Authorities say the suspected scam involves around ₹590 crore and has already led to 11 arrests, including bank employees, private individuals, and a government official.

The case is currently being investigated by the Haryana State Vigilance and Anti-Corruption Bureau, which has formed a Special Investigation Team (SIT) to examine the complex network of financial transactions.

Fraud Detected During Government Account Review

The suspected fraud came to light when several departments of the Haryana Government noticed discrepancies while reviewing and closing certain financial accounts. Preliminary findings suggest that funds were allegedly transferred from government accounts into multiple private bank accounts without proper authorization.

Investigators believe the transactions were carried out through manipulated banking records, fake debit memos, forged signatures, and unauthorized transfers, enabling money to be routed into accounts linked to shell companies.

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Fake Companies Used to Divert Funds

According to investigators, the accused allegedly created or used multiple shell companies to move the funds. Among the firms identified in the probe are:

• RS Traders

• Cap Co Fintech Services

• SRR Planning Gurus Private Limited

• Swastik Desh Project

Authorities suspect these entities were used as front companies to receive diverted government funds before the money was distributed across other accounts connected to the accused.

Multiple Bank Accounts Across Government Departments

Initial investigations indicate that 12 bank accounts belonging to eight government departments were involved in the suspected transactions.

Officials said that:

• 10 accounts were maintained at an IDFC First Bank branch in Chandigarh

• 2 accounts were held at AU Small Finance Bank

Authorities are now analyzing financial records to determine which transactions were legitimate and which were unauthorized, while tracing the full flow of funds.

Arrests Include Bank Employees and Officials

So far, 11 individuals have been arrested in connection with the case. These include:

• Six bank employees

• Four private individuals

• One government official

Most of the accused are currently in judicial custody, while at least one suspect remains on police remand for further questioning.

Officials said the investigation may expand as more evidence emerges.

Raids, Seizures and Frozen Bank Accounts

Investigators have carried out raids at 16 locations as part of the probe. During these searches, authorities recovered a large number of documents and digital records believed to be connected to the alleged fraud.

Key recoveries include:

• More than 25 electronic devices, including laptops and mobile phones

• Financial documents related to property purchases

• Video evidence from several locations

Authorities have also requested the freezing of more than 100 bank accounts suspected to be linked to the fraudulent transactions.

Luxury Vehicles and Properties Under Scanner

Investigators have also seized six luxury vehicles, including:

• Three Toyota Fortuners

• Two Toyota Innovas

• One Mercedes-Benz

Officials suspect these vehicles may have been purchased using funds linked to the alleged scam.

In addition, 10 properties have been identified that are believed to have been acquired using proceeds of the suspected fraud. These assets are currently under investigation.

Allegations of Forged Signatures and Fake Banking Records

Investigators say some of the transactions involved forged signatures of senior officials and fabricated bank documents.

Authorities allege that fake debit memos were created or funds were transferred without valid cheque authorization, while forged bank statements were allegedly used to conceal the unauthorized transfers.

A large volume of records obtained from banks and government departments is currently being examined by forensic and financial experts.

Bank Says Affected Departments Compensated

Sources familiar with the matter said the bank has reimbursed the affected government departments for the claimed principal amount and interest, though the investigation into the alleged fraud remains ongoing.

Following the news of the case, the bank’s shares reportedly experienced volatility in the stock market.

Investigation Expanding

Officials said the SIT is continuing to analyze financial records from the past year and trace the complete trail of transactions. Investigators are also examining whether additional officials, bank staff, or external parties were involved in facilitating the alleged scheme.

Authorities have indicated that further action will be taken if additional evidence confirms involvement of other individuals or entities.

The case is being pursued with coordination between multiple government agencies as investigators attempt to unravel what could be one of the largest alleged fraud cases involving government funds in the region in recent years.