Chandigarh Administration Implements Stringent Financial Controls After Major Fraud
In a decisive response to the alleged Rs 590 crore fraud involving Haryana government funds at private banks, the Chandigarh administration has issued a stringent advisory to all its departments. The move aims to tighten financial controls and prevent similar risks to public funds.
Immediate Reconciliation and Shift to Secure Banks
The UT finance department has directed all departments to immediately reconcile their bank accounts with private lenders and shift operations exclusively to secure financial institutions. According to the advisory, departments must now open and operate accounts only in Domestic Systemically Important Banks (D-SIBs)—specifically State Bank of India (SBI), ICICI Bank, and HDFC Bank—as well as other nationalized banks.
Administrative Secretaries and Heads of Departments (HoDs) have been made personally responsible for ensuring full compliance with these new directives. This heightened accountability underscores the administration's commitment to safeguarding public money.
Background: The Haryana Fraud Case
The directive comes in the wake of a major fraud scandal uncovered in Haryana government-linked accounts at a private bank's Chandigarh branch. The case involved unauthorised transactions and suspected forgery, leading to discrepancies totalling approximately Rs 590 crore.
Haryana's State Vigilance and Anti-Corruption Bureau (ACB) is currently investigating the matter, with four individuals—including two former bank employees—arrested so far. The Haryana government has already de-empanelled the two private banks involved for official business, and the bank in question has reportedly repaid Rs 583 crore (principal plus interest) to affected Haryana departments while investigations continue.
Assurances from Banks and Precautionary Measures
UT finance secretary Diprava Lakra held a meeting with officials from the concerned banks to review the situation. "The banks assured us that the UT administration's funds are safe," Lakra stated. "They also committed that, if required, any affected amount would be returned along with applicable interest."
As a precautionary step, the finance department has instructed departments to reconcile accounts held with the two implicated banks without delay and report any discrepancies immediately. The administration is currently compiling comprehensive details of total funds deposited across these institutions.
Key Instructions for Departments
The advisory includes several critical instructions that departments must follow:
- Conducting monthly reconciliation of all bank accounts, vetted by designated accounts functionaries, with proper records maintained for audit purposes.
- Reviewing existing accounts to confirm they align with the new guidelines regarding bank selection.
- Special focus on accounts with the two private banks at the centre of the Haryana fraud case, which must undergo thorough reconciliation.
HoDs and accounts functionaries are required to certify that no embezzlement or irregularities exist in their respective departments' accounts. This certification process adds an additional layer of oversight and accountability.
Heightened Vigilance Across Government Entities
This UT advisory underscores heightened vigilance across government entities to safeguard public funds amid ongoing probes into the fraud. The comprehensive approach—combining immediate reconciliation, restricted banking partners, and personal accountability—represents a significant strengthening of financial governance protocols.
The administration's proactive measures reflect growing concerns about financial security in government operations and set a precedent for other jurisdictions facing similar challenges. As investigations into the Haryana fraud case continue, these new safeguards aim to prevent any recurrence while ensuring transparency in financial management.
