5 min readChandigarhFeb 26, 2026 12:33 PM IST
The Rs 590-crore fraud surfaced after three officials of Haryana’s Development and Panchayat Department initiated a probe when IDFC First Bank transferred only Rs 1.27 crore against the Rs 50 crore deposited by the department. Their inquiry revealed “forged” signatures of an IAS officer, transfers of funds to AU Small Finance Bank, and subsequent diversion of money into a company owned by the wife of the relationship manager at the IDFC First Bank.
The committee, formed on February 11 this year, submitted its report to the department only a few days ago, and the findings have now been handed over to the State Vigilance and Anti-Corruption Bureau (SV & ACB) for further investigation. The report also became the basis for the FIR registered against employees of IDFC First Bank, AU Small Finance Bank, and unidentified public servants on Monday. Comprising an additional director, deputy director, and an accounts officer, the committee suspected forgery and procedural lapses by officials of both banks.
The Development and Panchayat Department had opened two accounts in IDFC First Bank and AU Small Finance Bank on September 26, 2025, transferring Rs 50 crore to IDFC First Bank and Rs 25 crore to AU Small Finance Bank. Several Haryana departments had been parking their funds as fixed deposits in IDFC First Bank typically for one year. The committee noted that “no approvals for utilization of funds from the competent authority were issued at any stage and the entire amount of Rs 50 crore and Rs 25 crore were supposed to be safely parked in the accounts for the entire duration.” This was probed to know whether bankers diverted the funds based on an authorization letter from the department or acted independently.
On January 13, 2026, the department directed both banks to close their accounts and transfer the funds along with interest to Axis Bank. AU Small Finance Bank complied, transferring nearly Rs 25.46 crore to Axis Bank on January 16, 2026. However, the report highlighted that “IDFC First Bank transferred only nearly Rs 1.27 crore to Axis Bank and proceeded to close the account, despite the closure request clearly specifying that an amount of Rs 50 crore along with accrued interest was to be transferred.”
As part of the investigation, the panel asked IDFC First Bank to submit “the account opening form, log details and voucher details of all the transactions,” which the bank provided on February 16. Senior officials of the bank also attended the committee proceedings that day. The committee found multiple cheques and debit notes processed by the bank, observing that “these cheques, prima facie, bear forged signatures of the then Director General, Sh. DK Behera (an IAS officer), despite the fact that he had relinquished charge on 28.10.2025.” It further noted, “The debit notes attached with the cheques do not have any Memo No, or dispatch number and they again seem to contain forged signatures.” One cheque was particularly alarming: “It has also been observed that one of the cheques processed by the Bank mentions the amount in figures as Rs 2,50,00,000/- (two crore fifty lakh), whereas the amount in words is written as ‘Rupees Twenty-Five,’ which has been honoured and processed by the bank indicating a serious discrepancy,” the report stated, alleging it “appears to be an established act of malafide intention.”
According to the report, the account statement provided by IDFC First Bank showed transfers totalling Rs 46.56 crore to AU Small Finance Bank, based on cheques and debit notes, despite the department’s practice of using only debit notes for Mukhyamantri Gramin Awas Yojana accounts. The committee alleged that “forged account statements were provided by the bank to mislead the department’s officials” and that “prima facie the signature on the cheques processed by IDFC First Bank doesn’t seem to match with the signatory on the account opening form.” It further claimed, “the IDFC First Bank continued to do transaction even after receiving the signature update letter dated 10.12.2025 duly received on 12.12.2025, apparently, using the forged signature of Sh. DK Behera, the then Director General along with a forged debit note.”
According to the report, AU Small Finance Bank’s statement revealed that “various transactions have been made to Swastik Desh Projects, details of which are not known.” According to SV & ACB Director General AS Chawla, this was the main private company into whose accounts most of the funds—nearly Rs 300 crore—were transferred before being moved further.
