Investigation reveals how Rs 590 crore was siphoned from Haryana government accounts

An investigation by the Haryana State Vigilance and Anti-Corruption Bureau (SV & ACB) has uncovered a complex financial network allegedly used to siphon Rs 590 crore from government accounts held at IDFC First Bank. The fraud, which involves the alleged use of forged cheques and collusion between bank staff and government officials, has led to the arrest of six individuals, including former bank employees and a senior department superintendent.

The funds, intended for state development schemes, were allegedly diverted through shell companies and eventually traced to jewellery shops and private accounts. While the bank has repaid the full principal amount to the government, the ongoing probe seeks to unravel the full extent of the conspiracy and the systemic failures that allowed it to occur.

Background and Context

The origins of the fraud trace back to September 26, 2025, when the Haryana Development and Panchayat Department opened two accounts: one holding Rs 50 crore with IDFC First Bank and another with Rs 25 crore at AU Small Finance Bank. Several state departments had been parking funds in IDFC First Bank, typically as one-year fixed deposits.

The scheme came to light when a senior officer attempted to withdraw funds from the Rs 50 crore account designated for the Mukhyamantri Gramin Awas Yojana housing scheme. Bank officials reportedly denied the withdrawal, citing insufficient funds, and failed to recognise the individual who had previously retrieved a cheque book from the department. A departmental inquiry launched in February 2026 confirmed suspicions that forged cheques bearing the signature of a former IAS officer had been used to drain the accounts.

Key Figures and Entities

According to court documents and bureau filings, the alleged conspiracy centered around a nexus of former bank staff and government insiders. Key arrests include Ribhav Rishi, a former branch manager at IDFC First Bank, and Abhay Kumar, a former relationship manager. Investigators allege that these individuals played a central role in facilitating the unauthorised transactions.

The funds were largely funnelled into Swastik Desh Projects, a company owned by Swati Singla and her brother Abhishek Singla. Swati is the wife of accused former bank manager Abhay Kumar. The SV & ACB has also named Naresh Bhuwani, a department superintendent, as a critical intermediary. According to the bureau, Bhuwani received funds directly from Swastik Desh Projects and maintained constant contact with the accused bank officials. He is accused of receiving Rs 1.25 crore illicitly, using portions of the money to purchase a vehicle and transfer funds to family members.

Legal and Financial Mechanisms

Investigators have detailed a sophisticated operation designed to bypass standard banking oversight. The alleged mechanism involved an impersonator posing as a bank official to hand over a cheque book to government officials, only to have it retrieved almost immediately under the pretext that cheques were not used for scheme transactions.

Once in possession of the cheque book, the accused allegedly used forged signatures to transfer vast sums. Bureau records indicate that money was siphoned from accounts belonging to the Haryana School Shiksha Pariyojna Parishad, the Haryana State Pollution Control Board, and the Haryana Power Generation Corporation. The funds were consolidated in the Swastik Desh Projects account before being dispersed to jewellers, the accused bankers' relatives, and private individuals. Call detail records analysed by investigators reportedly confirm sustained communication among the accused during these transactions.

International Implications and Policy Response

While the fraud is currently contained to specific government accounts in Haryana, the case highlights broader vulnerabilities in the banking sector regarding internal controls and the monitoring of high-value government deposits. In response to the allegations, IDFC First Bank moved quickly to mitigate liability, suspending four employees and filing a police complaint.

In a regulatory filing to the National Stock Exchange on February 21, the bank clarified that the incident was confined to a specific group of government-linked accounts at its Chandigarh branch. Notably, the bank stated it had honoured 100 percent of the principal and interest claimed by the Haryana government, amounting to Rs 583 crore, and appointed an independent external agency for a forensic audit. The Haryana Vigilance Bureau has indicated that the investigation will be extensive, aiming to identify all beneficiaries and close regulatory loopholes that allowed for the large-scale forgery of documents and bank statements.

Sources

This report draws on statements from the Haryana State Vigilance and Anti-Corruption Bureau, court filings reviewed in Panchkula, and official communications from IDFC First Bank submitted to the National Stock Exchange in 2026.