The Central Bureau of Investigation has arrested Ram Kumar Singh, a Haryana IAS officer and former Municipal Corporation Commissioner of Panchkula, in connection with a major financial fraud involving IDFC First Bank and AU Small Finance Bank. The case involves the alleged misappropriation of approximately ₹79.46 crore from Panchkula Municipal Corporation funds, which forms part of a larger banking scam estimated at around ₹504 crore. According to investigative agencies, the operation involved the large-scale misuse of government funds from multiple Haryana government departments through fraudulent fixed deposits and manipulated debit instruments. Officials allege that funds were illegally withdrawn in violation of financial guidelines and routed through shell companies to conceal the transactions.
Modus Operandi and Branch Networks
The central agency stated that Singh allegedly collaborated with bank officials and intermediaries to issue signed cheques under the pretext of creating fixed deposits. These instruments were then used to directly transfer government funds. Investigators revealed that no actual fixed deposits were ever created, and the money was instead diverted into multiple accounts. A senior accountant from the Panchkula Municipal Corporation was also arrested earlier in connection with the same case. Preliminary findings suggest that the then Municipal Commissioner played an active role in facilitating the financial network behind the scam.
The fraud was not limited to a single branch or institution but operated as part of a larger network involving multiple Haryana government departments. Funds amounting to nearly ₹504 crore from eight departments were allegedly manipulated using fake fixed deposit documents and banking instruments before being routed to shell entities.
Scrutiny of Banking Personnel and Searches
During the investigation, multiple searches were conducted at the Chandigarh and Karnal residences of Singh. Officials recovered several incriminating documents and digital evidence, which are currently under analysis to strengthen the ongoing probe. The investigation was initially initiated by the State Vigilance and Anti-Corruption Bureau of Haryana before being transferred to the central agency. So far, charge sheets have been filed against 17 accused individuals, including bank officials, government employees, and private persons.
Officials from IDFC First Bank and AU Small Finance Bank are currently under scrutiny for their alleged role in facilitating the fraudulent transactions. Investigators claim that certain bank employees processed illegal transfers based on forged documentation, enabling the diversion of public funds. The probe agency described the case as a coordinated financial crime involving administrative officials, banking personnel, and private entities working together in a structured network. The scale and complexity of the fraud point to systemic lapses in financial oversight and compliance mechanisms.
Broader Pattern of Financial Irregularities
Earlier charge sheets in related cases have included officials linked to Chandigarh Smart City projects, CREST, and other banking fraud investigations, indicating a broader pattern of financial irregularities under investigation. Experts believe the case raises serious concerns about public fund management and banking supervision systems in India. The use of fake fixed deposits and shell companies to divert large sums of government money highlights significant vulnerabilities in institutional monitoring frameworks.
The investigation remains ongoing, and further arrests and charge sheets are likely as more evidence emerges. The ₹504 crore scam is considered one of the largest banking and public fund misappropriation cases in Haryana, with the probe expected to continue in the coming months.
