IDFC First Bank Uncovers Rs 590 Crore Discrepancy in Haryana Government Deposits
In a significant development, IDFC First Bank has reported a substantial discrepancy of Rs 590 crore in deposits held on behalf of the Haryana government at its Chandigarh branch. The bank has taken immediate action by suspending four employees pending a thorough investigation into the matter.
Escalation and Regulatory Response
The issue came to light following a directive from the Haryana state government on February 18, which instructed its departments to close accounts with private lenders. In response, IDFC First Bank escalated the matter to its board at a hastily convened meeting on February 21. The bank has since filed a police complaint and notified relevant regulators to ensure transparency and compliance.
The bank has also informed its statutory auditors and initiated the process of appointing an independent external agency to conduct a forensic audit. This step aims to uncover the root causes of the discrepancy and ensure accountability. Additionally, recall requests have been sent to certain beneficiary banks to lien-mark balances in suspicious accounts, preventing further unauthorized transactions.
Haryana Government's Strict Measures
In a decisive move, Haryana's finance department has de-empanelled IDFC First Bank and AU Small Finance Bank from all state business with immediate effect. This action bars any parking or transaction of government funds through these banks, reflecting the state's zero-tolerance policy towards financial irregularities.
On February 18, 2026, the Haryana government further tightened its rules on handling public funds. Under the new regulations:
- Departments can now open scheme accounts only in nationalised banks within the state.
- Accounts in private or corporate banks will require prior approval from the finance department.
These measures are designed to enhance oversight and prevent similar incidents in the future.
Scope and Impact of the Discrepancy
Based on a preliminary internal assessment, IDFC First Bank has stated that the issue is confined to a specific group of Haryana government-linked accounts operated through its Chandigarh branch. The bank emphasizes that this does not extend to other customers at the branch, ensuring minimal disruption to regular banking services.
The aggregate amount under reconciliation across the identified accounts is approximately Rs 590 crore. The eventual financial impact on the bank will depend on several factors, including:
- Validation of claims and recoveries.
- Lien-marking of balances in beneficiary accounts maintained with other banks.
- Liabilities of other entities involved in the transactions.
- The outcome of legal recovery proceedings.
The disclosure has been formally made to the exchanges and uploaded on the bank's website, maintaining transparency with stakeholders and the public.
