Bihar funds transfer scam exceeds Rs 355 cr; chief secretary says it may get much bigger

Physical verification of accounts maintained in districts across Bihar has been ordered, after over Rs 300-crore was found to have been fraudulently transferred into an NGO’s account(s) in Bhagalpur district.

india Updated: Aug 10, 2017 20:44 IST
Anil Kumar
Anil Kumar
Hindustan Times, Patna
Bihar funds scam,NGO Srijan,Fraudulent transfer
A police team at the Srijan Mahila Sahyog Samiti office, Bhagalpur (Bihar). (HT file photo)

More evidence was emerging by Thursday to show that the pilferage of public money by Srijan Sahayog Mahila Vikas Samiti, a Sabour (Bhagalpur)-based NGO, was threatening to blow into a major scam in terms of money involved and spread.

As such, the state government, on Thursday, ordered immediate physical verification of all accounts maintained by district administrations across Bihar. This was after it was found that hundreds of crores of rupees had been fraudulently transferred to the NGO’s account(s) in Bhagalpur district, using fake cheques.

“Preliminary investigations have indicated that nearly Rs 355.70 crore have been illegally transferred from three heads—land acquisition (Rs 270 crore), urban development schemes (Rs 70.70 crore) and district administration (15 crore)—into the account of the NGO. The sum involved may increase,” chief secretary Anjani Kumar Singh said.

The fraudulent withdrawal is being investigated by Economic Offences Unit (EoU) with an “open mind”, he said, while declining to comment on involvement of politicians, as was inferred by the media from a statement of chief minister Nitish Kumar here on Wednesday.

“It is a matter of pure crime. The modus operandi involved the complicity of Srijan office bearers with bank officials, who managed to transfer funds from district administration account into their own with the help of forged signatures of the district magistrate,” he said.

“The involvement of the custodian of the respective accounts into which the state government transferred funds under different heads, cannot be ruled out. Hence, three FIRs have been filed with Bhagalpur Kotwali police against the promoters of Srijan Mahila Sahyog—Amit Kumar and his wife Priya Kumari, bank officials and government employees entrusted with administering the funds”, he said.

“It is an instance of highly organised form of fraudulent transfer of government money. It smacks of involvement of people well versed with the processes involved. Its spread in other districts cannot be ruled out”, he said.

As to when the fraud started, the CS said this would unfold as the investigation progressed. “But the scam did not surface earlier as the fraudsters put sufficient amount into the accounts, as soon as they got hold of ‘information’ that a pay order had been issued. This ensured that cheques were not dishonoured for want of sufficient balance. However, one cheque bounced, which exposed the scam,” he said.

“The probe into the incident led to the discovery that the stipulated money was not present in the account, neither there was any trail of the transactions. But such huge transfers cannot take place without the involvement of bankers, as the normal banking practice is to cross verify the payment of high value cheques in excess of five digit threshold”, the CS explained.

RJD chief Lalu Prasad has already termed the scam as ‘bigger’ than the fodder scam, in which he has been convicted, and demanded a CBI enquiry.

First Published: Aug 10, 2017 20:44 IST