SRINAGAR, June 11, 2026 : The Central Bureau of Investigation (CBI) has registered a major corruption case against 19 private individuals, along with unknown officials of J&K Bank and unidentified public servants, over alleged irregularities in the sanctioning and diversion of loans under the Prime Minister’s Employment Generation Programme (PMEGP) in Jammu and Kashmir’s Bandipora district.
The PMEGP is a flagship Central Government scheme aimed at generating self-employment opportunities by providing financial assistance for setting up micro-enterprises in both rural and urban areas.
According to an FIR registered by the CBI last week, the case relates to alleged offences committed during the sanctioning and disbursement of multiple PMEGP loans at the J&K Bank branch in Sumbal from 2022 onwards.
The investigation agency has alleged that certain unidentified bank officials entered into a criminal conspiracy with beneficiaries and private individuals to secure the sanction of numerous PMEGP loans through fraudulent means.
As per the FIR, the loan amounts released to beneficiaries were allegedly diverted to accounts linked to the accused persons using forged, fabricated, and fictitious invoices and bills. The agency suspects that the funds were misused instead of being utilized for the purposes for which the loans had been sanctioned.
The CBI stated that the alleged diversion of funds, carried out in connivance with unknown public servants, resulted in wrongful losses to the bank and the public exchequer while providing unlawful financial gains to the accused individuals and officials involved.
The FIR further noted that the alleged misuse and diversion of loan funds prima facie indicate embezzlement and misappropriation of public money through acts amounting to criminal misconduct by public servants.
The case has been registered under various provisions of the Indian Penal Code (IPC), including:
- Section 120-B (Criminal Conspiracy)
- Section 409 (Criminal Breach of Trust)
- Section 420 (Cheating)
- Section 468 (Forgery for Purpose of Cheating)
- Section 471 (Using Forged Documents as Genuine)
Additionally, charges have been invoked under Section 13(1)(a) read with Section 13(2) of the Prevention of Corruption Act.
The FIR names 19 accused persons and also includes unknown public servants associated with agencies such as Khadi and Village Industries Board (KVIB), Khadi and Village Industries Commission (KVIC), District Industries Centre (DIC), banking officials, and private individuals.
The investigation has been assigned to a CBI Inspector-rank officer, who will examine the alleged conspiracy, fund diversion, and involvement of officials and beneficiaries in the case.
The probe is expected to focus on the sanctioning process, financial transactions, documentation submitted for loan approvals, and the utilization of funds under the PMEGP scheme.
