PF Fraud: EPFO Opens Investigation into Rs 1,000 Crore Scam; Employees Under Scanner

Employees' Provident Fund Organisation (EPFO), a retirement fund organization, has launched a probe into potential wrongdoing by its employees at a suburban Mumbai office, which might result in losses of up to Rs 1,000 crore for the organization.

According to ET, which cited sources with knowledge of the situation, the modus operandi is reportedly creating fictitious accounts and transferring money to or resolving claims against bankrupt companies like the financially strapped Jet Airways, which later applied to the National Company Law Tribunal (NCLT) for ownership transfer.

According to Prabhakar Banasura, a member of EPFO's central board of trustees, "we expect EPFO losses due to this particular fraud to mount to up to Rs 1,000 crore, arising due to violation of rules and tax evasions," he added that "offenders should be punished for doing injustice to members' life savings and maligning this apex retirement body."

The vigilance department is reviewing historical documents as part of an internal probe, according to officials, to ascertain the precise number of damages. Additionally, the EPFO central body will soon receive the final report.

According to the individuals named above, the scheme is said to have been carried out in Mumbai's Kandivali office utilizing the employment funds of Jet Airways crew members and then-pilots, many of who were ex-pats.

According to reports, Machindra Bamne, the senior social security assistant at the Kandivali PF office, was suspended due to the allegedly fraudulent PF claims made by Jet employees.

According to an order from the regional provident fund commissioner-1 RO, Kandivali East dated August 18, Bamne was found to have "received illegal gratification from some members into his bank account for the settlement of PF claims related to employees of M/s Jet Airways," the financial daily reported, citing the letter.

It is crucial to note that numerous Jet Airways pilots' or crew members' PF accounts were allegedly exploited fraudulently to transfer funds, allegedly to the benefit of some EPFO employees at the Kandivali office.

They were hand in glove with specific manipulators on the Jet side before the airline firm went to NCLT, according to Banasure, who was quoted in the article. I have brought up this issue with the appropriate authorities, including the EPF chairman.

Nilesh Kapadia, a senior social security assistant, was also discovered and reportedly complicit in the scheme. But before the swindle was discovered, he quit the organization a few years ago.

According to the EPFO representative, Jet Airways employees' PF accounts were closed without adhering to regular procedures, which cost the exchequer money because income tax was not paid.

Netizens have been asking for more updates from the organization while also doubting if the citizen’s money is safe in EPFO’s hands.