In a case involving the fraudulent transfer of Rs 31.93 crore from the District Land Acquisition Officer’s (DLAO) bank account in Bihar, enforcement agencies are investigating forgery and money laundering. The Enforcement Directorate (ED) earlier took a bank's branch manager into custody and provisionally attached assets valued at Rs 1.66 crore. Recently, Bihar Police’s Economic Offences Unit (EOU) lodged a fresh FIR connected to the matter.
According to the Economic Times, the accused used forged documents and fake signatures to transfer funds over two years. To cover his tracks, he opened 21 fake accounts using the Aadhaar and KYC details of bank customers. The stolen money was laundered through foreign entities linked to South Africa and the Philippines and diverted to banned gambling apps. The branch manager was granted bail after being produced before the local court. The ED's investigation into money laundering is ongoing. Following findings, Bihar Police filed a new FIR on June 27, 2025.
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According to reports, the branch manager hired money mules, giving incentives to those who used their bank accounts and UPI IDs to transfer the stolen funds, allowing him to hide his identity from investigators.
According to official ED documents, the inquiry began after Patna Police filed a formal complaint. On July 10, 2023, the branch manager was taken into custody by the Enforcement Directorate under the Prevention of Money Laundering Act. Preliminary attachments were made to assets valued at Rs 1.66 crore, and valuables worth Rs 1.38 crore were recovered during searches conducted at multiple locations. In January 2025, the ED continued its investigation and seized some more assets as part of the investigation. Some other accused have been arrested, and prosecution complaints have been filed.
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The new FIR expands the probe to include money laundering accusations, forgery and official diversion of funds. Officials continue to attempt to trace the money and determine if anyone else was involved. The case has also drawn attention to client verification procedures and the monitoring of high-value transactions, indicating the need for stronger safeguards to protect public funds.
Some reports said that the manager worked with Kotak Mahindra Bank to which the bank reacted.
“The incident dating back to 2021 was proactively identified by Kotak Mahindra Bank through its internal monitoring systems. The employee involved was terminated from employment with the Bank, and the matter was reported to the authorities. The Bank's reporting and cooperation with the law enforcement agencies led to the arrest of the individual and the recovery of a substantial portion of the funds. We continue to pursue the matter through appropriate legal channels. The case remains sub judice.
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While the investigators appear to have uncovered links to online betting platforms, the Bank had no involvement or visibility into these external activities since the activity relates to utilisation, by the ex-employee, of the proceeds from the fraud.
Kotak Mahindra Bank remains committed to strong governance, robust compliance practices, and the highest standards of customer protection.”
