Patna High Court. File Photo
By Alok Mohit
Patna: The Patna High Court has taken a serious note of an alleged large-scale bank fraud involving misappropriation of public funds across multiple branches of Uttar Bihar Gramin Bank, even as it continued interim protection from arrest to the accused.
While hearing an anticipatory bail plea of accused Dharmendra Kumar Singh in connection with a case lodged with Darauli police station in Siwan district of Bihar in 2024, the bench of Justice Purnendu Singh examined allegations of embezzlement amounting to Rs 47.64 lakh at the bank’s Kanhauli Branch-2 in Siwan during 2013–14. The FIR, lodged in August 2024, accused Singh—then an office assistant—and a co-accused branch manager of siphoning off customer deposits using forged fixed deposit certificates.
However, what initially appeared to be a branch-level fraud, during court proceedings, expanded into a much more complex case. The bank, in its affidavits, alleged a “systematic and sophisticated modus operandi” spanning multiple branches over several years, with total suspected irregularities exceeding ₹1.89 crore. The alleged method involved issuing fake money multiplier deposit certificates (MMDCs) without creating corresponding entries in the core banking system (CBS), allowing funds to be diverted undetected.
The court noted instances where customers’ deposits were reflected only in manual passbooks but never entered into official bank records. In one such case, a Rs 15-lakh deposit allegedly existed only on paper. These irregularities reportedly came to light years later when customers approached the bank to withdraw or mature their investments.
During the hearing, the petitioner’s counsel argued that Singh had a limited role as a “maker” in banking transactions and that approvals were required from higher authorities before disbursement. Singh’s counsel also highlighted a delay of nearly a decade in lodging the FIR and claimed that multiple internal audits had failed to detect any irregularities during that period.
The bank contested these claims, asserting that fraud cases were exempt from such procedural protections and that internal audits, limited in scope, may not uncover deeply embedded irregularities. It further alleged that Singh had been involved in similar misconduct across postings and had already faced departmental action.
The court observed that economic offences had wider consequences and could not be treated like ordinary crimes, particularly when public money and trust in financial institutions were involved. It also indicated that the alleged fraud might not be limited to one branch or a single individual.
Referring to inputs from National Bank for Agriculture and Rural Development (NABARD), the court said the pattern of transactions could have broader implications, including possible violations under anti-money laundering laws.
While not granting anticipatory bail at this stage, the court allowed the interim protection already in place to continue. It also directed that the matter be placed before the Chief Justice in view of its wider public importance.
The court sought responses from the Bihar advocate-general, the Reserve Bank of India and concerned Union ministries, asking them to submit an action taken report by June 18, 2026.
About the Author
Alok Mohit is a senior journalist based in Patna with decades of experience in mainstream journalism. He has previously served as Senior News Editor at Hindustan Times, Patna, and later at Hindustan Times, Chandigarh, where he played a key role in shaping news coverage and editorial direction. Known for his in-depth understanding of socio-political issues and strong editorial judgement, he continues to contribute insightful analysis and reporting on matters of public interest.
About the Author
