Rs 590-crore IDFC First Bank fraud case: How an AU Bank regional head ‘aided’ key accused, pocketed Rs 10 crore

“Investigation has revealed he (Sharma) sent forged bank statements and received approximately Rs 10 crore for carrying out illegal activities in connivance with the co-accused. He received Rs 2 crore in his bank account,” she added.

Arun Sharma was arrested on March 6 this year and was produced before a Panchkula court the next day. After a three-day police remand, Arun Sharma was sent to judicial custody.

Arun Sharma’s counsel, Aman Dutt Sharma, told The Indian Express on Monday that the Vigilance department sought his three-day police remand to recover an electronic device (laptop) from him. “The laptop belonged to his office and that should have been recovered from the bank itself. We had opposed the remand plea on the ground that as the laptop was to be recovered from the bank itself, there was no need for a three-day-long remand,” said the counsel.

Other IDFC First Bank case accused

Meanwhile, the Vigilance report submitted to the Panchkula court also details the alleged role of former IDFC First Bank staffer Anuj Kaushal, who processed transactions “as the maker in Haryana School Shiksha Pariyojna Parishad, Haryana State Pollution Control Board, Haryana Rural Development Fund Administration Board, Haryana Power Generation Corporation Limited Employees Pension Fund Trust in an unauthorised manner.”

Kaushal is accused of preparing forged memos and processing them despite mismatches in the details.

Another accused, Priyana Bhatoa, “was posted as banker customer experience (cashier/maker) at the relevant time of commission of offence was allegedly actively involved in forging the record, prepared false and fabricated Fixed Deposits, and exchanged the same on e-mail.” She allegedly processed debit transactions from government accounts without proper authorisation.

Another accused, Ankur Sharma, is a partner in SRR Planning Gurus Private Limited, formed in July 2024. The firm is accused of receiving Rs 45 crore diverted from Haryana government departments. Vigilance noted, “He (Sharma) actively assisted Ribhav Rishi in siphoning off the government fund in a blatant illegal manner.”

The Vigilance report further stated that the prime accused, Ribhav Rishi and Abhay Kumar, conspired with Rajan Singh Katodia of Sawan Jewellers, Chandigarh, to divert funds into shell firms. Katodia allegedly received over Rs 250 crore by issuing fake bills for gold sales and converting the proceeds into cash after deducting commissions.

Another accused, Amit Dewan of Haryana Power Generation Corporation Limited, was the director of finance when accounts were opened in IDFC First Bank and AU Small Finance Bank.

“The procedure laid down by the government was deliberately violated with ulterior motives. He connived with the key accused, specifically Ribhav Rishi, and actively assisted him in the commission of offences as alleged. He accepted hefty illegal gratification for the same, as substantiated through material seized or statements of witnesses,” said the report.

Preliminary investigations suggest that the prime accused created multiple fake firms and companies to divert government funds into fictitious accounts. Money from various departments was transferred without authorisation, suggesting a wide-ranging conspiracy involving bankers, government officials, and private entities.

AU Bank’s stance

After the fraud surfaced in February, the Haryana Government decided to “de-empanel IDFC First Bank and AU Small Finance for government business in the state of Haryana with immediate effect till further orders.”

In response, AU Small Finance Bank issued a statement on February 22, saying, “Based on available facts at this stage and preliminary review, there is no indication of any financial impact or any fraudulent activity towards the Bank. To ensure a fair and transparent review, certain employees have been placed off-duty.”

“We, as a Bank, reiterate our commitment to strong governance, transparency, and the safeguarding of public funds and will continue to engage with the Government of Haryana for re-empanelment and communicate with all other stakeholders.”

On February 23, following a departmental inquiry by officials of the Panchayat Department, the Haryana State Vigilance and Anti-Corruption Bureau registered an FIR against employees of IDFC First Bank and AU Small Finance Bank, and unidentified public servants.