IDFC First Bank Confirms Fraudulent Incident Findings at Chandigarh Branch, Implements Control Enhancements

IDFC First Bank Confirms Fraudulent Incident Findings at Chandigarh Branch, Implements Control Enhancements​

IDFC First Bank Limited has confirmed the findings of a forensic review concerning fraudulent activities linked to its Sector 32 branch in Chandigarh. The Board of Directors reviewed the report from KPMG, confirming that the incident was an isolated instance involving collusion between certain bank and customer employees and third parties.

The comprehensive investigation reaffirmed that the fraud involved specialized malicious activity at the designated branch. The Bank confirmed it is a victim of the financial fraud and has been working closely with investigative authorities regarding the matter.

Financial Impact and Resolution

Of the 56 in-scope accounts reviewed, the primary claim amounted to INR 645.59 crores across 13 affected accounts. The Bank has paid this principal amount, along with applicable interest amounting to INR 30.60 crores, to the concerned departments and account holders. The Bank recognized these payments as an expense in its books of accounts for Q4FY26, covering the quarter and year ended March 31, 2026.

The forensic review detailed that the unauthorized transactions were executed through a pattern of collusion. This involved circumventing existing branch-level manual controls. The modus operandi included manipulating or editing authorization letters, misusing cheques, and falsifying approval emails attached to transaction vouchers. Furthermore, non existent Fixed Deposit Advices (FDA), edited interest certificates, and modified bank account statements were provided to customers in certain instances.

Operational Integrity and Mitigation Measures

The Bank confirmed that its Core Banking System (CBS) records remained accurate throughout the incident period. Customers who held accounts with the institution received monthly account statements and transaction alerts via SMS as per standard processes.

In response to the findings, IDFC First Bank has implemented several additional preventive controls to significantly strengthen its control framework and mitigate collusion risk at the branch level. These new measures include a centralized oversight process, enhanced customer communication protocols, and other technology led system controls.

Post the incident, the Bank went beyond standard operating procedures by sending physical and/or email statements reflecting closing balances as of February 28, 2026, to all relevant government and TASC (Trust, Association, Societies & Clubs) account holders across India. To date, no other discrepancies or claims have been received from any other customers nationwide following this exercise.

The Bank continues to pursue its vision to become a world class bank in India by building on stronger foundations through these process enhancements.

IDFCFIRSTB Stock Price Movement​

IDFC First Bank Limited finished the trading day in gains, with shares closing higher by 0.33% to settle at ₹72.35. The stock demonstrated strong investor interest, registering a total traded volume of 28.67 million shares during the session.