IDFC First Bank Stock Crashes 20% After Rs 590 Crore Fraud in Haryana Government Accounts
How a routine account closure request uncovered a ₹590 crore fraud at IDFC First Bank’s Chandigarh branch, affecting government-linked accounts, prompting stock sell-off and regulatory action.
Shares of IDFC First Bank plunged sharply on February 23, 2026, after the lender disclosed a ₹590 crore fraud at its Chandigarh branch involving accounts linked to the Haryana government. The stock hit the 20% lower circuit during early trade, reflecting strong selling pressure following the regulatory disclosure.
On the Bombay Stock Exchange (BSE), the share price touched the lower circuit limit of ₹66.85. Around 10:25 am, the stock was trading down 18.84% at ₹69.10 on the National Stock Exchange (NSE). On the BSE, it was down 16.50% or ₹13 at ₹69.77. The sharp decline came despite the stock having ended the previous week in positive territory, rising 0.64% to close at ₹83.51 on the NSE.
The sudden fall marked one of the steepest single-day declines for the bank’s shares in recent times.
Discrepancies Detected During Reconciliation
According to the bank’s disclosure, the issue surfaced after a Haryana government department requested closure of its account and transfer of funds to another bank. During the reconciliation process, inconsistencies emerged between balances recorded in the bank’s books and figures maintained by the government entities.
From February 18 onwards, multiple Haryana government departments contacted the lender regarding mismatches in their accounts. A deeper internal review identified irregular transactions confined to a defined group of government-linked accounts operated through the Chandigarh branch.
The bank stated that the irregularities were limited to these specific accounts and did not affect other customers of the branch or its wider deposit base.
Four Officials Suspended
The lender said certain employees were suspected of involvement in carrying out the unauthorised transactions. Four officials at the Chandigarh branch have been suspended pending investigation.
In its statement, the bank said it would pursue “strict disciplinary, civil and criminal action” against employees and any external individuals found responsible, in accordance with applicable law. A complaint has been filed with the police.
The matter was reviewed by a Special Committee of the Board on February 20, followed by discussions at the Audit Committee and full Board level. Regulators and statutory auditors have been informed.
Containment and Recovery Efforts
As part of immediate containment measures, the bank has sent recall communications to certain beneficiary banks and requested lien marking on balances in accounts identified as suspicious. These steps are aimed at preventing further movement of funds and securing recoverable amounts.
An independent external agency is being appointed to conduct a forensic audit. The review will examine transaction trails, identify control gaps, and determine accountability.
The financial impact will be assessed after the forensic investigation and recovery process provides clarity on potential losses.
Investor Reaction
The sharp drop in the share price reflects investor concern over internal controls following the disclosure. A lower circuit movement indicates sustained selling pressure during the session.
The size of the disclosed amount, relative to recent profitability, has intensified scrutiny of branch-level oversight and compliance systems. While recovery prospects remain under evaluation, the immediate market response signals heightened sensitivity to governance-related developments.
Fraud disclosures involving government accounts typically draw attention due to the public funds involved and the need for strict operational safeguards.
Regulatory Oversight and Next Steps
The bank has reported the matter to the relevant authorities and is coordinating with law enforcement as the investigation progresses. Based on preliminary findings, the irregularities appear confined to the identified accounts at the Chandigarh branch rather than reflecting a broader institutional issue.
The forensic audit is expected to clarify the sequence of transactions, assess procedural lapses, and recommend corrective measures where necessary.
For the lender, the immediate focus remains on completing the investigation, pursuing recovery, and reinforcing internal monitoring systems. Further disclosures are likely as findings emerge and financial implications become clearer.
The bank has reiterated that other customers of the branch remain unaffected.
As the probe continues, attention will centre on accountability, recovery outcomes, and the strengthening of safeguards designed to prevent similar incidents in the future.
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Kulshreshth Chaturvedi
I’m Kulshreshth Chaturvedi, a writer and author specialising in creative writing, blogs, and professional content. I write on literature, ideas, and modern perspectives, focusing on clear, engaging, and well-structured storytelling. My goal is to create meaningful writing that inspires readers, builds connections, and delivers real value through words.
