EPFO scam of Rs 1,000 crores: Fake accounts created, funds transferred & claims settled in defunct firms

 New Delhi: Retirement fund body Employees’ Provident Fund Organisation (EPFO) has started an investigation into possible wrongdoing by its staff at a Mumbai suburban office, which could involve estimated losses of up to Rs 1,000 crore for the organisation.

Citing people with knowledge of the matter, ET reported that the modus operandi is believed to be creating fake accounts and transferring funds or settling claims in defunct firms such as cash-strapped Jet Airways which later went into the National Company Law Tribunal (NCLT) for transfer of ownership.

“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,” Prabhakar Banasure, a member of EPFO’s central board of trustees, told the financial daily, highlighting that “offenders should be punished for doing injustice to members’ life savings and maligning this apex retirement body.”

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Officials mentioned that an internal investigation is underway and the vigilance department is scrutinising past records to determine the actual quantum of losses. Plus, a final report will soon be submitted to the EPFO central body. People cited above are of the view that the scam was allegedly committed in Mumbai’s Kandivali office, using employment funds of then pilots, including many expats, and crew members of Jet Airways.

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The senior social security assistant of Kandivali PF office, Machindra Bamne, was reportedly suspended over the alleged fraud of Jet employees’ PF claims. Bamne was found to have “received illegal gratification from some members into his bank account for settlement of PF claims related to employees of M/s Jet Airways”, regional provident fund commissioner-1 RO, Kandivali East, wrote in an order dated August 18, the financial daily reported, citing the letter.

Read more at: https://www.taxgyata.com/ap/epfo-scam-of-rs-1000-crores/

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