CAG Audit Uncovers Major Financial Irregularities in Haryana Government Departments
A recent report by the Comptroller and Auditor General (CAG) has exposed severe violations in the handling of public funds by various government departments in Haryana. The audit, which covers the financial year 2023-24 and was presented in the state Assembly on Monday, highlights that multiple offices continued to deposit government money in private bank accounts, directly contravening established treasury regulations that mandate the use of nationalised banks, with a preference for the State Bank of India.
Link to Rs 590 Crore Fraud at IDFC First Bank
The findings gain heightened significance in light of a massive Rs 590 crore fraud that emerged at the Chandigarh branch of IDFC First Bank. In this case, funds linked to government entities were allegedly siphoned off through forged fixed deposit receipts and manipulated account records. The CAG report explicitly warns that depositing government funds in private banks bypasses treasury oversight, weakens financial control, and increases exposure to fraud. It documents instances where departments opened separate bank accounts outside the treasury framework, stored grants and scheme money in these external accounts, and frequently failed to reconcile balances, thereby obstructing legislative oversight and creating a high risk of fraud and embezzlement.
Government Response and Investigation
Chief Minister Nayab Singh Saini addressed the Assembly, stating that the government had de-empanelled IDFC First Bank on February 18 and directed the transfer of the entire amount, along with interest, to a nationalised bank. He assured that every single rupee will be recovered and announced a probe to determine if the irregularity was confined to bank employees or involved others. The case has been handed over to the Anti-Corruption Bureau (ACB), and a high-level committee has been ordered to conduct a detailed inquiry. Saini noted that the bank acknowledged irregularities by certain employees in a letter to SEBI on February 21 and initiated action against them.
Political Accusations and Historical Context
Former Congress MLA Neeraj Sharma accused the state government of deliberately endangering nearly Rs 590 crore by ignoring safeguards introduced in 2012-13, such as the Personal Ledger Account (PLA) system designed to keep surplus departmental funds within the state treasury and instructions limiting deposits to government banks. He labeled the incident a corruption driven by personal motives and demanded a time-bound probe to fix accountability, including disclosure on whether relatives of politicians received jobs or benefits linked to the bank.
The issue came to light when government records showed large sums parked in IDFC accounts, but withdrawal attempts revealed mismatched balances, indicating unauthorized transfers. A senior government official commented that the IDFC case exemplifies the financial risks highlighted in the audit, serving as a textbook example of vulnerability in the system.
