ED attaches Rs 10.63 crore Kashmir properties in PMEGP loan fraud crackdown

The Enforcement Directorate has provisionally attached 11 immovable properties valued at Rs 10.63 crore in Kashmir under the Prevention of Money Laundering Act, taking stern action to protect central welfare funds from financial fraud.

Targeting illicit gains in Srinagar and Bandipora districts, the Srinagar zonal office of the agency issued the attachment order against land and buildings belonging to suppliers, brokers, and an official of J&K Bank. The action follows an investigation into the systemic misappropriation of funds under the Prime Minister Employment Generation Programme (PMEGP), a flagship central scheme designed to generate self-employment opportunities across the nation.

Scheme misuse and dummy borrowers

According to the Enforcement Directorate, private brokers and bank personnel operated a criminal conspiracy to cheat J&K Bank and siphon off public funds. Key accused Hilal Ahmad Wani and others allegedly enticed dummy borrowers, taking control of their KYC documentation to process fraudulent loan applications.

To justify the disbursements, the network generated fake invoices from non-existent supplier companies registered under the names of brokers and their relatives. Bank officials at the Sumbal and Gamud Gadkhud branches of J&K Bank then approved these fraudulent loans without proper verification, leading to direct financial loss for the institution.

Scope of financial diversion

A survey conducted by investigators at the Sumbal and Gamud Gadkhud branches under Section 16 of the PMLA uncovered widespread operational compromise. A total of 540 PMEGP loan accounts turned into non-performing assets, creating a massive bad debt load.

Investigators established that diverted funds were funneled through multiple bank accounts to conceal their origins. A significant portion was siphoned directly for personal enrichment, including the construction and renovation of residential and commercial assets registered under family members of the accused.

Anti-corruption probe and next steps

The money laundering probe relies on initial First Information Reports registered by the Central Bureau of Investigation in Srinagar. The CBI and the Jammu and Kashmir Anti-Corruption Bureau registered cases alleging criminal conspiracy, with a fresh FIR filed by the CBI in June 2026.

The Enforcement Directorate stated that the bulk of the proceeds of crime has been siphoned through deliberately structured transfers, establishing direct involvement in money laundering. Further investigations remain under way as enforcement agencies continue working to dismantle the corruption network and recover stolen public assets.