CBI registers FIR against 19 in PMEGP loan fraud in J&K's Bandipora
Synopsis
The CBI has formally opened an investigation into a PMEGP loan fraud at J&K Bank's Sumbal branch in Bandipora, naming 19 private individuals alongside bank officials and public servants from three government bodies. Forged invoices allegedly funnelled public money into private accounts — a pattern that points to systemic institutional failure, not just individual misconduct.
Key Takeaways
The CBI registered an FIR against 19 individuals in the PMEGP loan fraud case in Bandipora, Jammu and Kashmir .
Accused include private individuals, J&K Bank officials, and public servants from KVIB, KVIC , and DIC .
Loans were allegedly sanctioned at the J&K Bank Sumbal branch from 2022 onwards and diverted via forged and fictitious invoices .
Charges include criminal conspiracy, cheating, forgery, and corruption under the IPC and the Prevention of Corruption Act .
The CBI stated the fraud caused a wrongful loss to the bank and the public exchequer while benefiting the accused.
The Central Bureau of Investigation (CBI) has registered a First Information Report (FIR) against 19 individuals in connection with an alleged loan fraud under the Prime Minister's Employment Generation Programme (PMEGP) in Bandipora district of Jammu and Kashmir, officials said on Thursday, 11 June. The case involves alleged criminal conspiracy, cheating, forgery, and corruption in the sanctioning of multiple PMEGP loans at the J&K Bank branch in Sumbal from 2022 onwards.
Who Is Named in the FIR
The FIR has been registered against 19 private individuals, along with certain officials of J&K Bank and public servants from KVIB (Khadi and Village Industries Board), KVIC (Khadi and Village Industries Commission), and DIC (District Industries Centre). The charges are framed under Sections 120-B, 409, 420, 468 and 471 of the Indian Penal Code, as well as Section 13(1)(a) read with Section 13(2) of the Prevention of Corruption Act.
How the Fraud Was Allegedly Carried Out
According to the FIR, unknown bank officials allegedly conspired with the accused beneficiaries and private individuals to secure the sanction of numerous PMEGP loans. Once released, the loan amounts were reportedly diverted to the accounts of the accused through forged and fictitious invoices and bills.
The CBI stated that this diversion of funds, carried out in connivance with unknown public servants, caused a wrongful loss to the bank and the public exchequer while generating corresponding wrongful gains for the accused. 'This diversion of funds also prima facie establishes embezzlement/misappropriation of public funds through the criminal misconduct of the unknown public servants,' the FIR stated.
What Is the PMEGP Scheme
The Prime Minister's Employment Generation Programme is a Central Sector Scheme administered by the Ministry of Micro, Small and Medium Enterprises. It provides financial assistance to set up micro-enterprises in both rural and urban areas, with the stated aim of generating self-employment and reducing unemployment. The scheme channels funds through banks including J&K Bank, making it vulnerable to institutional collusion when internal oversight fails.
Significance and What Comes Next
This is among the more significant fraud investigations targeting a welfare-linked credit scheme in Jammu and Kashmir, with the CBI's involvement signalling that the alleged irregularities extend beyond routine administrative lapses. The registration of the FIR last week marks the formal opening of an investigation; searches, arrests, and asset seizures could follow as the agency builds its case. The identities of the unnamed public servants referenced in the FIR are expected to emerge as the probe advances.
Point of View
KVIC, and DIC — alongside J&K Bank personnel, which suggests the alleged fraud exploited gaps across multiple institutional layers simultaneously. PMEGP is a high-disbursement welfare scheme with limited on-ground verification, making it structurally susceptible to collusion between bank staff and implementing agencies. The Bandipora case is unlikely to be isolated; it should prompt a systemic audit of PMEGP disbursements across J&K, not just a narrow prosecution of the 19 named accused. Whether the unnamed public servants are eventually charged will be the real test of this investigation's reach.
NationPress
12 Aug 2026
Frequently Asked Questions
What is the CBI's PMEGP loan fraud case in Bandipora?
The CBI has registered an FIR against 19 individuals — including J&K Bank officials and public servants — for allegedly conspiring to fraudulently sanction and divert PMEGP loans at the J&K Bank branch in Sumbal, Bandipora, from 2022 onwards. The funds were reportedly siphoned through forged invoices and fictitious bills.
What is the PMEGP scheme and why is it significant in this case?
The Prime Minister's Employment Generation Programme is a Central Sector Scheme that provides financial assistance to set up micro-enterprises in rural and urban areas. In this case, the scheme's credit pipeline was allegedly exploited through institutional collusion, causing losses to both J&K Bank and the public exchequer.
Who are the accused in the Bandipora PMEGP fraud case?
The FIR names 19 private individuals along with certain J&K Bank officials and public servants from KVIB, KVIC, and DIC. Some public servants implicated remain unidentified and are expected to be named as the investigation progresses.
What charges have been filed in the CBI's Bandipora FIR?
The accused face charges under Sections 120-B (criminal conspiracy), 409 (criminal breach of trust), 420 (cheating), 468 (forgery), and 471 (using forged documents) of the Indian Penal Code, as well as Section 13(1)(a) read with Section 13(2) of the Prevention of Corruption Act.
What happens next in the CBI investigation?
The registration of the FIR marks the formal start of the investigation. The CBI is expected to conduct searches, record statements, and potentially make arrests as it builds its case. The identities of unnamed public servants referenced in the FIR are likely to surface as the probe advances.
