ED attaches ₹10.63 crore properties in J&K PMEGP loan fraud case
Synopsis
The ED has attached 11 properties worth ₹10.63 crore in J&K after uncovering a systematic PMEGP loan fraud involving dummy borrowers, fake invoices, and J&K Bank insiders — with ₹32 crore in NPAs and ₹11.37 crore in traced proceeds of crime pointing to a fraud far larger than the attachment alone.
Key Takeaways
The ED's Srinagar Zonal Office provisionally attached 11 properties worth ₹10.63 crore in Srinagar and Bandipora districts under the PMLA .
The fraud involved dummy PMEGP borrowers , fake invoices of non-existent firms, and criminal conspiracy with J&K Bank officials.
A survey found 270 term loan accounts and 270 working capital accounts at two J&K Bank branches had turned NPA , with a total NPA of approximately ₹32 crore .
Proceeds of Crime of ₹11.37 crore have been traced, routed through multiple accounts and partly used for asset construction.
Key accused Hilal Ahmad Wani and others allegedly induced borrowers and misused their KYC documents to sanction fraudulent loans.
The case stems from CBI-ACB FIRs ; a fresh FIR was also registered in June 2026 .
The Directorate of Enforcement (ED)'s Srinagar Zonal Office has provisionally attached 11 properties — comprising lands and buildings — worth ₹10.63 crore across Srinagar and Bandipora districts of Jammu & Kashmir, in connection with a loan fraud case under the Centre's Prime Minister Employment Generation Programme (PMEGP). The attachment order, issued under the Prevention of Money Laundering Act (PMLA), targets assets held by suppliers-cum-brokers and a J&K Bank official allegedly involved in systematically misusing the flagship employment scheme.
Background: How the Fraud Was Structured
The ED's probe was triggered by two First Information Reports (FIRs) registered by the Central Bureau of Investigation's Anti-Corruption Branch (CBI-ACB) in Srinagar, which alleged misappropriation of PMEGP loan amounts in criminal conspiracy with borrowers, branch officials of J&K Bank, and unidentified individuals. According to the agency, the accused cheated the bank and caused wrongful loss to it while securing corresponding wrongful gains for themselves. The CBI-ACB also registered a fresh FIR in the matter in June 2026.
Scale of the Fraud: 270 Loan Accounts Turned NPA
A survey conducted during the ED's investigation at the Sumbal Branch and Gamud Gadkhud Branch of J&K Bank revealed that 270 term loan accounts along with 270 working capital accounts under the PMEGP scheme had turned into Non-Performing Assets (NPAs). The cumulative NPA amount was found to be approximately ₹32 crore.
Investigators determined that the loans were availed by projecting dummy borrowers, using fake invoices of non-existent firms registered in the names of suppliers-cum-brokers or their family members, and in criminal conspiracy with bank officials. The KYC documents of actual borrowers were allegedly misused to sanction loans under false pretences.
Key Accused and Proceeds of Crime
The investigation has named Hilal Ahmad Wani and others as playing a major role in fraudulently availing PMEGP loans. According to the ED, borrowers were induced to participate, after which their documents were leveraged to channel funds illegally. The agency has traced Proceeds of Crime (PoC) amounting to ₹11.37 crore, which were routed through multiple bank accounts in layered transactions. A portion of the PoC was used for the construction and renovation of assets held in the names of family members, while a bulk of the funds were siphoned off — establishing diversion, concealment, and use of proceeds of crime, the ED stated.
What the Attachment Covers
The provisional attachment under Section 5(1) of the PMLA covers 11 assets held or controlled by the suppliers-cum-brokers and one bank officer. The ED said the attachment has been executed to safeguard the value of the identified proceeds of crime. Notably, PMEGP is a Central credit-linked subsidy scheme designed to generate self-employment opportunities — making its misuse particularly significant given its intended beneficiaries are small entrepreneurs and artisans.
What Happens Next
The provisional attachment will be presented before the Adjudicating Authority under PMLA for confirmation. Further investigation into the full extent of the conspiracy — including the role of additional bank officials and the tracing of remaining siphoned funds — is reportedly ongoing. This action is part of a broader pattern of ED enforcement across J&K's banking sector, where PMEGP-linked irregularities have drawn sustained regulatory scrutiny.
Point of View
With bank insiders as co-conspirators, represents a double failure of oversight. The ₹32 crore NPA figure across just two branches suggests the problem extends beyond the individuals named. Unless the ED and CBI trace the full network of brokers and complicit officials, the attachment risks being a visible action on a much deeper rot.
NationPress
9 Nov 2026
Frequently Asked Questions
What is the PMEGP loan fraud case in J&K?
The PMEGP fraud in J&K involved the misuse of the Centre's Prime Minister Employment Generation Programme, where dummy borrowers, fake invoices of non-existent firms, and J&K Bank officials allegedly conspired to fraudulently sanction and misappropriate loans. The ED has traced proceeds of crime of ₹11.37 crore and found that 270 term loan accounts at two bank branches turned NPA, with total NPAs of around ₹32 crore.
What properties has the ED attached in this case?
The ED has provisionally attached 11 assets — including lands and buildings — worth ₹10.63 crore in Srinagar and Bandipora districts of Jammu & Kashmir. These properties were found in the possession of suppliers-cum-brokers and a J&K Bank official linked to the fraud.
Who is Hilal Ahmad Wani and what is his alleged role?
Hilal Ahmad Wani has been identified by the ED as a key accused who allegedly played a major role in fraudulently availing PMEGP loans. He and others reportedly induced borrowers to participate, then used their KYC documents and fake invoices to get loans sanctioned in criminal conspiracy with bank officials.
What law is the ED using to attach these properties?
The ED has issued a Provisional Attachment Order under Section 5(1) of the Prevention of Money Laundering Act (PMLA). The order will be placed before the Adjudicating Authority under the PMLA for confirmation, as is standard procedure in such cases.
What was the basis for the ED's investigation?
The ED launched its investigation based on two FIRs registered by the CBI's Anti-Corruption Branch in Srinagar, which alleged misappropriation of PMEGP funds through criminal conspiracy. A fresh FIR was also registered by the CBI-ACB in June 2026, further expanding the scope of the case.
