Jammu and Kashmir police is probing a multi-crore fraud uncovered in HDFC Bank’s internal audit at its branch in Shopian district of the Union Territory
The bank, through its cluster head, South Kashmir, has lodged an FIR at the Shopian Police station accusing two of its employees posted at its Shopian branch of financial fraud over the last many years. The two accused in the FIR—Irfan Zargar and Aadil Ayub—were posted as managers in the bank one after another, during which they allegedly conducted the fraud.
The FIR (168/2025) has been registered under Sections 316 (5) (criminal breach of trust), 318 (4) (cheating), 336 (3) (forgery), 340 (2) (using a forged document or electronic record) of the Bharatiya Nyaya Sanhita (BNS). The accused have also been booked under section 66 (C) of the IT Act, which deals with fraudulent or dishonest use of another person’s electronic signature, password, or other unique identification feature.
The discrepancy was detected by the bank’s Branch Operations Transformation and Control (BOTC) wing in June this year. The bank found a variation between an account holder’s physical cash and electronic record.
LiveMint found that the bank detected a shortfall of ₹1.35 crore in the account. The bank reached out to the account holder, a businessman named Asim Iqbal Wani, Director Freshman, a CA store in Pulwama. Asim found that his loan account was still showing an outstanding balance against him, though he had already received an NOC from the bank via email.
“The bank found that the manager at that time had not closed the loan account despite all payments being made. In fact, it’s entries showed 1.35 Crore outstanding balance against me,” said Asim.
As word spread, other branch account holders found discrepancies in their transactions as well. Harried account holders wrote emails and letters to the bank’s management, including thechairman.
In one case, that LiveMint spoke with, the manager had issued a fake FD document of ₹20 Lakh to an account holder after taking the money from him. The customer was shocked to find that the FD that he had been banking on for years did not exist at all.
Eventually, it was found that the financial frauds were happening in the bank’s Shopian branch since 2020.
The bank is the custodian of the money. There is an agent-principle relationship between the bank and its employees. The principle is liable for the frauds committed by its agents during the course of employment.
LiveMint reached out to HDFC Corporate Communication for a comment through email and phone. The bank spokesperson refused to comment since the case is under police investigation now. The bank has taken action against the managers with one of them being suspended.
“We are glad the bank has filed an FIR. But what about our money? After all, the bank is the custodian of the money. There is agent-principle relationship between the bank and its employees. The principle is liable for the frauds committed by its agents during the course of employment,” said an aggrieved customer who did not want to be named.
The FIR says that since the case has ‘inter district ramifications’ and is of public importance involving complex and technical expertise, it is therefore proposed that the case be transferred to the economic offence wing of Crime Branch of Jammu and Kashmir Police.