In a significant development, IDFC First Bank revealed that four employees at its Chandigarh branch are suspected of being involved in a ₹590 crore fraud targeting accounts linked to the Haryana government. The bank disclosed this information in a regulatory filing on 21 February.
The bank’s preliminary internal assessment uncovered suspicious activities within the Chandigarh branch, which appear to involve collusion with other entities. The total amount under reconciliation across the affected accounts is estimated at approximately ₹590 crore, with the impact confined to specific Haryana government-linked accounts operated through this branch.
According to the filing submitted to the Bombay Stock Exchange (BSE), the fraud came to light after the bank received a request from a Haryana government department for account closure and fund transfer. During the process, discrepancies were observed between the account balances as reported by the Haryana government entities and the actual balances held with the bank.
The bank clarified that the irregularities are limited to certain government accounts and do not affect other customers of the Chandigarh branch. The exact timing of the fraudulent activities is yet to be established, pending an external independent investigation.
IDFC First Bank stated that the individuals involved are believed to be employed at the Chandigarh branch and that the fraud may involve collusion with external parties. The bank emphasized that further details will be determined after ongoing validation and recovery efforts.
In response to the incident, the bank has taken several measures, including informing regulators, filing a complaint with law enforcement, and cooperating fully with authorities. Additionally, the bank is commissioning an independent forensic audit to investigate the matter thoroughly.
Internally, four suspected employees have been suspended pending investigation. The bank has also convened a meeting of the Special Committee for Monitoring and Follow-up of Frauds, and the Board’s Audit Committee has been briefed about the situation. Furthermore, the bank has issued recall requests to beneficiary banks to place liens on suspicious accounts involved in the case.
IDFC First Bank has assured that it will pursue strict disciplinary, civil, and criminal action against those responsible, in accordance with legal procedures, and continues to cooperate with law enforcement agencies to resolve the issue.