Haryana Police Nabs Kotak Bank Employee in ₹160 Cr Municipal Funds Scam

A former Kotak Mahindra Bank employee has been arrested for his alleged role in the fraud involving public funds belonging to Haryana's Panchkula Municipal Corporation.

Haryana Police arrested Dileep Kumar Raghav on Wednesday, who previously worked as a Relationship Manager at the bank's Panchkula branch.

"Accused Dileep Kumar Raghav has been arrested in the Kotak Mahindra Bank case. He was the relationship manager in the bank at the time of commission of offence. He had sent false reports to Panchkula Municipal Corporation regarding the fixed deposits after conspiring with key accused," the official Police statement said.

What Allegedly Happened

The municipal corporation had deposited public money in fixed deposits (FDs) with Kotak Mahindra Bank. However, when the civic body recently asked the bank to return the money upon maturity, the amounts didn't add up.

The suspected discrepancy is estimated at ₹150-160 crore, the public money that was supposed to be safely deposited in a government-linked bank account.

Police have said that Raghav sent fake reports to the municipal corporation, making it appear that the fixed deposits existed and were in order, when they may not have been. Investigators believe he did not act alone and are probing possible links with other accused in the case.

Kotak Mahindra Bank had earlier said it is actively reconciling, essentially cross-checking, all FD accounts linked to the municipal corporation following a request from the civic body itself. The bank claimed that a significant portion of the funds under question has already been accounted for.

The bank has also filed a formal complaint with Panchkula Police, saying it is fully cooperating with authorities and is committed to getting to the bottom of the matter. Police is continuing to investigate whether other bank officials or outsiders were involved.

The Kotak case is not an isolated incident. It follows closely on the heels of a separate alleged fraud at IDFC First Bank, which recently disclosed a ₹590 crore discrepancy linked to certain employees and accounts associated with a Haryana government department at its Chandigarh branch.

In that case too, the issue came to light when a government department requested closure of its account and a transfer of funds, only for mismatches to emerge during the process.

IDFC First Bank later clarified that the matter was confined to a specific set of government-linked accounts and did not affect other customers. IDFC First later paid ₹645 crore to clients linked to the suspected fraud