It all started on January 13, when the Development and Panchayats Department of Haryana directed IDFC First Bank and AU Small Finance Bank to transfer the Rs 50 crore and Rs 25 crore, respectively, parked with them, along with interest, to Axis Bank and to close the accounts.
AU Small Finance Bank transferred Rs 25.46 crore. However, IDFC First Bank transferred only Rs 1.27 crore to Axis Bank. The amount was related to the Mukhya Mantri Grameen Awas Yojana 2.0 scheme. The bank accounts were opened on September 26, 2025.
The Panchayats Department formed a committee to look into the fraud. On February 16, IDFC First Bank submitted the account-opening form, login details, and voucher details for all transactions. It turned out that multiple cheques were used for payment transfers. They bore the signatures of the then department head, DK Behera, despite his having relinquished charge on October 28, 2025. Also, the department had never used cheques but only debit notes. Even the debit notes used did not have any memo or dispatch number.
Scale of the fraud
In one case, the cheque showed the amount in figures as Rs 2.5 crore, and Rs 25 crore in words. Still the cheque was processed. It turned out that various transfers totalling Rs 46.56 crore were made to the AU Small Finance Bank account based on cheques and debit notes.
The account statement also reflected that the transactions had been made with the office of the Haryana State Pollution Control Board and Municipal Corporation, Panchkula, which were unexplained. The inquiry found that AU Small Finance Bank was non-cooperative in providing records and the bank statement showed funds were siphoned off to a shell entity, Swastik Desh Projects.
Following the inquiry report on February 18, various Haryana departments engaged with IDFC First Bank to reconcile funds, and several reported discrepancies.
Case registered, probe begins
On February 22, in a regulatory filing with the stock exchanges, IDFC First Bank reported a Rs 590-crore fraud committed by its employees and others. The very next day, the government got registered an FIR with its State Vigilance and Anti-Corruption Bureau (SV&ACB).
On February 24, Chief Minister Nayab Singh Saini announced that Rs 556 crore had been recovered from IDFC First Bank. On March 30, AU Small Finance also returned Rs 25 crore to the Haryana Power Generation Corporation Limited (HPGCL).
As per the government, the departments that got entangled in the IDFC First Bank case included Haryana State Pollution Control Board (Rs 222.03 crore), Panchkula MC (Rs 81.03 crore), Haryana Labour Welfare Board (Rs 54.29 crore), HPGCL (Rs 54.20 crore), Haryana School Shiksha Pariyojna Parishad (Rs 54.05 crore), Haryana Rural Development Fund Administration Board (Rs 49.84 crore), Kalka MC (Rs 30.64 crore), and HSAMB (Rs 10.07 crore). A total of Rs 556.15 crore was involved.
The government maintains it has recovered the entire amount. So, the banks bore the brunt.
The CBI took over the case and registered an FIR on April 8. As per the letter sent by the government to the Secretary, Ministry of Personnel, for a CBI probe, “The case pertains to fraudulent banking operations and fictitious transactions allegedly undertaken in a systematic manner to siphon off government funds into the accounts of shell entities, including Swastik Desh Project, SRR Planning Gurus Pvt. Ltd., Cap Co Fintech Services, RS Traders, and associated firms/individuals.”
The ‘mastermind’
The CBI has identified Ribhav Rishi as the mastermind of the scam. He was the bank manager at IDFC First Bank, Sector 32, Chandigarh. When he moved to AU Small Finance Bank, he allegedly continued the illegalities. He was in touch with Haryana officials to open accounts and paid illegal gratification to them, as well as to other accused.
The CBI revealed that gold worth Rs 200 crore was purchased in the names of shell companies and handed over to persons connected with Rishi. Siblings Swati Singla and Abhishek Singla, proprietors of the Swastik Desh Project firm, allegedly received Rs 292 crore. The money was further sent to various entities and individuals.
On April 23, the Development and Panchayats Department’s Superintendent Naresh Kumar was dismissed for allegedly receiving Rs 6.55 crore and a Toyota Fortuner from the co-accused, and for allegedly purchasing a house in Mohali in his wife’s name. A Chief Accounts Officer in the education department, Randhir Singh, was dismissed on April 24 for fraud amounting to Rs 54 crore.
On April 30, Rajesh Sangwan, Controller, Finance and Accounts, HSAMB, was dismissed for Rs 10-crore fraud. On May 3, Amit Dewan, a former Director of Finance at HPGCL, was dismissed for allegedly receiving Rs 50 lakh in illegal gratification.
Kotak Mahindra Bank scam
A similar fraud came to light in the Kotak Mahindra Bank branch in Panchkula. According to SV&ACB’s FIR dated March 24, the Municipal Corporation, Panchkula, was maintaining 16 Fixed Deposits (FDs) with the branch in Sector 11. These deposits amounted to Rs 145.03 crore, with a maturity value of Rs 158.02 crore.
Of these, 11 FDs worth Rs 59.58 crore matured on February 16. MC officials were provided with statements that did not match with the records. The scam had continued since 2018, according to SV&ACB.
Here too, branch manager Pushpender Singh was the alleged mastermind. He, along with an MC Senior Accounts Officer, Vikas Kaushik, fraudulently opened two MC accounts. He allegedly transferred government funds to fraudulent accounts. From there, these reached individuals and were rerouted to Pushpender. About Rs 70 crore “was also given” to a builder, Sunny Garg.
Two IAS officers have been suspended in the scams: Pardeep Kumar and RK Singh. Four IAS officers have been transferred. The CBI has sought permission to investigate the role of IAS officers in the IDFC First case. Haryana has de-empanelled all three banks.
