Chandigarh, Haryana: A detailed inquiry into the IDFC First Bank scam in Haryana has revealed that forged cheques and debit notes were key instruments used in siphoning off government funds, authorities said, as the state moves to tighten banking controls and pursue strong legal action. The alleged scam, spotted at a Chandigarh branch of IDFC First Bank, involved discrepancies in signatures, amounts and procedural norms on multiple financial instruments related to Haryana government accounts.

Haryana Chief Minister Nayab Singh Saini disclosed the findings after a three-member inquiry committee was set up on February 11, 2026. CM Saini also said that the state has already recovered Rs 556 crore including Rs 22 crore in interest from the fraudulent transactions within 24 hours of the scam coming to light.

How the Scheme Accounts Were Exploited

The probe traced the fraud to funds deposited under the Mukhyamantri Gramin Awas Yojana (MMGAY) 2.0 for rural housing. The Development and Panchayats Department had placed Rs 50 crore in IDFC First Bank and Rs 25 crore in AU Small Finance Bank when two accounts were opened on September 26, 2025, though no authorization to utilize them was ever granted.

When the department later requested that these funds be transferred to Axis Bank on January 13, 2026, AU Small Finance Bank duly complied and transferred Rs 25.46 crore. However, IDFC First Bank transferred only Rs 1.27 crore before closing the account, raising immediate suspicion and triggering further scrutiny.

Key Findings: Forged Signatures and Discrepancies

The inquiry panel observed several red flags in the transactions:

• Multiple cheques and debit notes were processed with signatures that appeared forged, including those purportedly belonging to then Director General D.K. Behera, who had relinquished charge as early as October 28, 2025.

• The supporting debit notes lacked memo or dispatch numbers, suggesting insufficient documentation and possible fabrication.

• One cheque cleared by the bank showed a glaring amount mismatch: Rs 2.50 crore in figures but “Rupees twenty-five crores” in words, yet the transaction was still processed.

Such discrepancies indicate a breakdown in internal controls and highlighted serious procedural lapses that allowed the fraud to continue over months.

Mobile Alerts and Transaction Red Flags

Probe teams also found that transaction alerts, such as SMS notifications, were sent to a mobile number registered under a government superintendent, Prince, who was subsequently questioned though the exact nature of his involvement remains under investigation.

Crucially, officials in the relevant department told investigators that cheques were not the standard mode of executing payments under the MMGAY 2.0 scheme; instead, they typically use debit notes exclusively. That made the use of cheques in multiple transactions a distinctive anomaly.

Broader Probe and Legal Action

Following the inquiry’s findings, the Haryana Vigilance and Anti-Corruption Bureau registered an FIR under provisions of the Prevention of Corruption Act alongside charges related to forgery, cheating and other offences against unknown bank officials and others involved.

The government also de-empaneled both IDFC First Bank and AU Small Finance Bank from state financial operations, mandating that all departmental funds be routed through public sector banks with immediate effect, enhancing oversight and mitigating further risks.

Wider Implications and Ongoing Investigations

Independent reports suggest the alleged fraud totals around Rs 590 crore, with investigations extending to linked transactions across multiple government departments and external accounts allegedly involved in the irregular transfers. IDFC First Bank has reportedly paid back the entire principal and interest amount roughly Rs 583 crore to the concerned Haryana departments even as forensic audits and law-enforcement cooperation continue.

The probe is ongoing, with the state government underlining that no official whether government employee, private individual, or bank staff will be spared if evidence confirms wrongdoing. Authorities have also formed a high-level committee to review overall banking policy and prevent such frauds in future.

 A Haryana government inquiry into the IDFC First Bank scam has revealed forged cheques and debit notes were at the Centre of a ₹590 crore fraud involving government accounts. Rapid recoveries and FIR registrations mark an aggressive response, and the incident has triggered reforms in how state funds are managed and safeguarded.