The Haryana government has granted permission to the CBI to investigate the alleged role of five IAS officers in the ₹590 crore IDFC First Bank fraud case under section 17A of the Prevention of Corruption Act (PCA). According to The Economic Times, this approval allows the CBI to call the officers for questioning, as no police officer can conduct inquiries into offences by public servants without previous approval from competent authority. The investigation will focus on various administrative approvals that allowed the depositing of government funds in private banks, based on disclosure statements of accused persons and investigator findings.
The Central Bureau of Investigation conducted searches at seven locations across Chandigarh and Panchkula on May 14 as part of its investigation into the alleged misappropriation of ₹590 crore in Haryana government funds. According to The Economic Times, the searches targeted residential properties, business establishments, and jewellery showrooms as the CBI works to unravel a complex web of fraudulent transactions involving IDFC First Bank and AU Small Finance Bank. The case was officially handed over to the CBI by the Haryana government in April. During the searches, various incriminating documents and articles were recovered and seized, including financial records and digital evidence pertaining to the fraud and suspected misappropriation. The agency confirmed that 16 accused persons have been arrested in the case, with the investigation being expedited by the CBI, and several leads are being pursued.
Investigators have uncovered a sophisticated scheme where bank officials allegedly worked in collaboration with government employees to divert state deposits into accounts of shell entities. As reported by The Economic Times, certain officials of IDFC First Bank and AU Small Finance Bank, in connivance with public servants of various departments of the Haryana government, allegedly misappropriated government funds through fraudulent means. The funds were originally intended for government fixed deposits but were instead routed through companies including Swastik Desh Projects and Capco Fintech Services. The investigation has revealed that the fraud was executed by routing siphoned government funds through layered banking structures into private entities, with one instance involving a ₹10 crore fraudulent transfer from a newly opened savings account split via RTGS directly to a private planning firm and contractors. The CBI investigation has resulted in 16 arrests so far, including former bank managers and senior state personnel.
The investigation timeline reveals that an inquiry committee constituted in February 2026 by the Director, Development and Panchayats Department had uncovered irregularities and discrepancies in accounts operated in IDFC First Bank and AU Small Finance Bank. As reported by The Economic Times, based on the committee's report and supporting documents, the case was referred to the State Vigilance and Anti-Corruption Bureau (SV&ACB) for criminal investigation. On February 23, an FIR was lodged at the SV&ACB police station in Panchkula under various sections of the PCA and the Bharatiya Nyaya Sanhita (BNS). The matter was subsequently handed over to the CBI, demonstrating the systematic approach to addressing the financial crime.
The Enforcement Directorate, India's financial crimes agency, is conducting a separate money-laundering investigation alongside the CBI probe. According to The Economic Times, the ED recently arrested two former IDFC First Bank employees, Ribhav Rishi and Abhay Kumar, who allegedly used floating shell companies in the names of their household staff to layer the siphoned money. This coordinated approach demonstrates the multi-agency effort to address the financial crime.
