Rs 50 crore and counting: How Jharkhand’s alleged ‘treasury scam’ exposes system’s vulnerabilities

The alleged treasury scam, however, does not involve any external hacking or system breach. Instead, it involves internal manipulation wherein the authorised employee “illegally withdrew” the amounts in the name of salaries, taxes, arrears, etc., of those employees who had either retired or died. For many years, in some cases for around a decade, the diversion of funds went undetected into various associates’ accounts of the accused, also called “ghost” accounts.

Last month, during the state Finance Department’s routine analysis and audit of the treasury accounts, attention was drawn to the financial irregularities. The first case emerged from Bokaro’s Superintendent of Police (SP) office, with the alleged initial fraud of around Rs 3.15 crore. This gradually increased to other districts after the probe began. 

Owing to the ongoing investigation, investigators from the Crime Investigation Department (CID) and the Finance Department’s Principal Accountant General refused to share any details. Despite no official statement, the amount stands at nearly Rs 50 crore.

After the Bokaro case, Chief Minister Hemant Soren and Finance Minister Radha Krishna Kishore initiated a probe across 24 districts.

Modus operandi

According to the FIR filed in Bokaro, the accused — an accountant at the SP’s office — made an illegal withdrawal in the name of a former police official (retired in 2016) from May 2024 to March 2026. The amount was routed to a bank account belonging to the accused’s wife and then to the accused’s account.

“The amount has reached to around Rs 10 crore in this case, which will possibly increase in future,” said Bokaro District Collector Ajay Nath Jha.

Following this, a similar pattern was seen in the Hazaribagh Police Department’s treasury, with around Rs 30 crore. The FIR mentioned that investigation revealed that around Rs 30 crore were siphoned off over the last 10 years using 21 different SBI accounts. These transactions were linked to the SP office. It was found that the main accused was a police constable who was originally from Bihar’s Gaya. He allegedly transferred the amount to accounts related to Gaya and Mumbai.

The inquiry in Ranchi revealed another alleged fraud in treasury payments at the Institute of Animal Health and Production. The FIR in this case mentioned that the accountant and the staffer allegedly manipulated their basic salary figures on the Kuber portal to withdraw excess funds between 2023 and 2026.

“The probe found that the accountant withdrew about Rs 1.52 crore and the staffer around Rs 1.41 crore, totalling nearly Rs 3 crore,” the FIR said. The FIR further stated that both tampered with official salary records to inflate payments and illegally siphon government money, prompting orders for criminal proceedings against them.

In West Singhbhum district, suspicious transactions worth around Rs 26.21 lakh linked to the SP office were found. Investigation revealed that a constable, posted in the accounts branch, used multiple SBI accounts across Jharkhand and Odisha to siphon off government funds between 2017 and 2025. The probe also found discrepancies between digital and physical records, indicating data tampering.

In Ramgarh, investigation revealed that an ex-employee under the Animal Husbandry Department siphoned off around 35 lakh illegally. The FIR mentioned that he made a false account in the Kuber portal in the name of an Adivasi man and withdrew around Rs 11 lakh from the treasury. Also, between 2014 and 2021, he withdrew around Rs 24 lakh with false bills. The accused in Ramgarh’s case is the same person involved in the Ranchi case.

The Jharkhand government’s Kuber portal (treasury payment) module, though which salaries are disbursed.

Although FIRs have not yet been registered in several other districts, opposition leaders and media reports have flagged similar alleged irregularities. For instance, in Deoghar district, an alleged illegal withdrawal of around Rs 3 crore is currently under probe.

Sources indicated that suspected irregularities may span up to 14 district treasuries, with around 15 arrests reported so far across Jharkhand. While officials have so far pegged the detected amount at about Rs 50 crore across five districts, some senior officials and political leaders have suggested that it could rise to Rs 100-150 crore or more in due course.

Systemic blind spot

While investigators have not yet publicly detailed how the alleged fraud continued undetected for years, an officer posted in one of the 14 affected treasuries, speaking on condition of anonymity, outlined the system and its vulnerabilities.

According to the officer, bills — particularly salary bills — originate at the concerned department level, where a billing clerk prepares them, an accountant or head clerk checks them, and the drawing and disbursing officer (DDO) certifies details such as employees’ names, bank accounts, and IFS codes. Once signed, the bills move to the treasury, where they pass through clerical staff and a head assistant before reaching the Treasury Officer for final approval and payment through the Kuber portal.

The officer, however, admitted that in practice, scrutiny is largely limited to the summary sheet like gross and net amounts, deductions, bill number, month, and the DDO’s certification — especially in bulk submissions that can run into hundreds of bills a day. “No one checks each individual account or amount in such volumes; we rely on the DDO’s certification,” the officer said, adding that salary bills are generally treated as low-risk.

This reliance, coupled with high volumes and multiple DDOs across departments, creates a systemic blind spot where manipulated entries can pass through layered approvals without detailed verification.

Interestingly, a 2025 report by the Comptroller and Auditor General of India detailed significant information technology control failures in the IFMS that have facilitated financial irregularities and unauthorised payments. While the report covered the period from 2007 to November 2022, it noted that its findings remain relevant for subsequent periods.

The report also identified the scale of irregularity: the IFMS database revealed 344 cases of excess payments totaling Rs 11 crore.

Political row

The alleged treasury fraud has now snowballed into a sharp political confrontation, with the opposition BJP intensifying its attack and linking the case to what it calls a larger pattern of scams, even drawing parallels with the Fodder Scam. 

BJP leaders have also questioned the role of DDOs, pointing out that these posts are typically held by high-ranking officers who are part of the same police setup and, in some cases, associated with the CID, raising concerns over how an internal probe would be impartial.

Such large-scale withdrawals could not have occurred without higher-level protection and has demanded a probe by Central agencies like the Enforcement Directorate and CBI, the party said.

On the other hand, the ruling Jharkhand Mukti Morcha countered that the irregularities stem from systemic loopholes created during the previous Raghubar Das-led BJP government.