IDFC First Bank Shares Crash After ₹590 Crore Fraud Linked To Haryana Govt Accounts
IDFC First Bank Shares Crash After ₹590 Crore Fraud Linked To Haryana Govt Accounts
Four officials suspended as Chandigarh branch scam shakes investor confidence and triggers government action
A major financial fraud of ₹590 crore has been uncovered at a Chandigarh branch of IDFC First Bank, sending shockwaves through the banking sector and triggering a sharp fall in the bank’s share price.
The bank has officially admitted that irregularities were found in accounts linked to departments of the Haryana government. The issue came to light during a routine process when several Haryana government entities approached the branch on February 18, 2026, seeking closure of their accounts and transfer of funds to another bank.
During the reconciliation process, discrepancies were observed between the balances reported by the government entities and the balances reflected in the bank’s system. The funds that were expected to be available were not matching the official records, leading to the discovery of the large-scale fraud.
According to the bank, preliminary internal investigations indicate that certain employees misused their positions and carried out unauthorised transactions in a specific set of government-linked accounts handled through the Chandigarh branch. The bank clarified that the issue is limited to this group of accounts and does not extend to other customers of the branch.
Following the revelation, IDFC First Bank has suspended four officials pending investigation. The bank stated that strict disciplinary, civil and criminal action will be taken against any employees or external parties found involved. A formal complaint has also been filed with the local police, and the matter has been reported to the banking regulator.
The lender has estimated the fraud amount at ₹590 crore, though it said the final figure will be determined after detailed reconciliation, validation of claims and any recoveries.
The market reacted sharply to the development. On February 23, the bank’s shares fell nearly 20 per cent in early trade, hitting the lower price band at ₹66.85 on the BSE. The stock later recovered slightly but still closed down over 16 per cent at ₹70.04. Heavy selling wiped out significant market capitalisation, bringing it down to around ₹61,000 crore.
In a separate move, the Haryana government has de-empanelled IDFC First Bank and AU Small Finance Bank for government-related financial transactions with immediate effect until further orders. An official circular stated that no government deposits, investments or transactions will be routed through these institutions for now.
The bank has also alerted other financial institutions where the funds were allegedly transferred and requested immediate freezing of suspicious accounts to prevent further movement of money.
Disclaimer: This article is for informational purposes only and should not be construed as investment advice. Investors are advised to consult certified financial advisors before making decisions in volatile market conditions.
