HYDERABAD: The exercise of reviewing staff strength, including permanent and temporary workers, initiated by the Finance department, has reportedly uncovered what officials describe as one of the largest salary-linked frauds in recent years, with more than 6,000 suspect outsourced and contract-based employees traced across various government departments.
Preliminary assessments indicate that the irregularities may have cost the state exchequer over Rs 600 crore per annum. The department has concluded that the fraud has been in operation for close to seven years, largely driven by certain outsourcing agencies in collusion with a section of officials.
Funds allocated for payment of salaries appear to have been siphoned off using fabricated identities and bank accounts. The scale of diversion, believed to be to the tune of Rs 600 crore per annum, has prompted senior officials to explore recovery options, including invoking provisions of the Revenue Recovery Act and initiating criminal cases against those responsible.
Identity manipulation
According to sources, investigations revealed that there were instances of dual employment, where some regular government staff allegedly drew salaries simultaneously as home guards or panchayat secretaries. In a few cases, salaries of male employees were found routed into accounts held by their spouses, heightening concerns of systematic identity manipulation.
With Aadhaar mismatches forming the core evidence, the Finance department has asked all departments to complete a physical verification of flagged employees. Officials say the next phase will focus on tracing the bank accounts into which fraudulent salaries were deposited and identifying individuals who withdrew the funds.
After verification, the names of more than 5,000 individuals have already been deleted from the payroll. The list includes contract staff and outsourced workers, the officials added.
A senior official said the findings would be placed before the government soon, following which decisions on punitive and recovery measures would be taken. The official added that a similar audit mooted during the previous government’s tenure did not progress due to “certain pressures”, but the present exercise had revealed the scale of losses and created scope for substantial savings going forward.
‘Deep-rooted’ anomalies
Sources said that the Finance department carefully verified the details of temporary employees, after the appointment of a committee to review staff strength across all departments by directing them to furnish Aadhaar details, linked bank accounts, and residential information of their employees, covering regular staff, contract workers and outsourced personnel.
The data processing, underway for nearly three months, has thrown up anomalies that officials say are both “deep-rooted” and “long-running.” When these records were cross-checked with payroll data, thousands of entries were found to be suspicious or unverifiable.
The Finance department sent back the questionable entries to the respective departments, seeking confirmation of the employees’ physical presence and service records. Instead of validation, several departments responded that many of the individuals marked on their payrolls were not in service at all, and recommended the removal of their names.