BENGALURU — What began as a small savings cooperative meant to support Employees’ Provident Fund Organisation (EPFO) staff has now become the center of a ₹70-crore financial scandal.
The EPFO Staff Credit Co-operative Society Limited, once viewed as a safe haven for employees’ savings, is under investigation for allegedly diverting crores in fixed deposits collected from serving and retired members.
According to the police complaint, the funds were gathered from nearly 300 members who were promised an annual interest of nine percent. Payments reportedly ceased three months ago, triggering alarm among contributors and prompting protests at the Cubbon Park police station.
The Complaint and the Accused
The complaint, filed by CJ Muralidar — a Section Supervisor at the EPFO office on Rajaram Mohan Roy Road and current president of the society — accuses several high-ranking officials of misappropriation. Among those named are Chief Executive Officer G. Gopinath, former accountant B.L. Jagadish, former presidents Jayashankar and Vijendra Rao, and ex-CEOs Lingappa Gowda and Prabhakar.
Police officials confirmed that a case has been registered under sections of the Bharatiya Nyaya Sanhita (BNS) pertaining to cheating, criminal breach of trust, and forgery. Deputy Commissioner of Police (Central) Akshay M. Hakay said that the Cubbon Park police have begun a detailed probe into the allegations.
Over 50 current and former EPFO employees gathered outside the police station demanding swift action and the arrest of the accused, alleging years of manipulation and falsified records.
The Missing Funds and Forged Records
According to the FIR, an internal audit led by Muralidar uncovered major discrepancies in the society’s accounts. While records showed deposits totaling around ₹70 crore, only ₹3.5 crore had been legitimately disbursed as loans — a gap suggesting large-scale fund diversion.
Investigators allege that society officials created fake financial statements, forged signatures, and manipulated ledgers to mask the misappropriation. The fraud reportedly spanned several years, during which successive office-bearers continued to attract deposits from employees by assuring stable, high returns.
“The payments stopped without warning, and that’s when suspicions grew,” said one staff member familiar with the investigation. “We trusted our own people, and that makes this betrayal harder to process.”
Fallout Within the EPFO Community
The scandal has sent shockwaves through the EPFO’s Bengaluru offices, long regarded as a bastion of financial integrity. Many employees now face uncertainty over their savings, and retired staff — who had invested their life’s earnings — have demanded urgent government intervention.
For a department responsible for managing millions of Indians’ retirement funds, the episode has become a reputational crisis. While the EPFO has clarified that the alleged fraud involves a staff-run cooperative and not official provident fund accounts, questions persist about how such large-scale irregularities escaped notice.
