ED Arrests Two Former IDFC First Bank Employees as Haryana Funds Scam

The Enforcement Directorate (ED) has arrested two former employees of IDFC First Bank in connection with an expanding Rs 645 crore money laundering and embezzlement case involving Haryana government accounts, the Chandigarh administration, and private institutions.

The accused, former branch manager Ribhav Rishi and ex-relationship manager Abhay Kumar , worked at the bank’s Sector 32 branch in Chandigarh. They were arrested by the ED’s Chandigarh zonal office under the Prevention of Money Laundering Act (PMLA) and produced before a special court, which remanded them to ED custody till May 21.

According to the ED, the probe has revealed alleged diversion of public funds worth Rs 645 crore from accounts maintained by the Haryana government, the Chandigarh UT administration, and two private schools in Chandigarh and Panchkula. Investigators alleged the money was siphoned off through a network of shell firms, forged instruments, and layered transactions .

The agency claimed Rishi floated shell entities Capco Fintech Services and RS Trader using the names of his personal assistant and driver , while Kumar allegedly operated Swastik Desh Projects through his wife and brother-in-law. ED officials said these firms received hundreds of crores directly diverted from government-linked accounts before the funds were routed through multiple channels to conceal their origin.

Investigators suspect the fraud involved forged cheques and debit notes carrying fake signatures of senior officials. Reports also indicate that nearly Rs 400 crore may have been diverted using accounts linked to relatives and associates of the accused.

The scam first surfaced during a reconciliation exercise initiated by the Haryana government earlier this year. Following the discovery, the Haryana government ordered departments to shut accounts in certain private banks, while IDFC First Bank reimbursed over Rs 578 crore to affected government departments within 24 hours, according to official statements.

The ED is now tracing the full money trail, examining property purchases, and probing the possible involvement of additional bank officials, private individuals, and government employees.