Concurrent audit of the Employees’ Provident Fund Organisation (EPFO) has flagged major irregularities of nearly ₹96 crore last year, including fraudulent withdrawals from members’ EPF accounts and a major pension fraud.

These audit findings have been shared in the EPFO’s annual report for 2021-22, which will be tabled before the Central Board of Trustees at its upcoming meeting to be held on October 31 and November 1.

Among the audit alerts probed in 2021-22, EPF payments through wallet banking also revealed irregularities of ₹30.38 crore, even as fraudulent withdrawals by modifying EPF members’ Know Your Customer (KYC) details were also unearthed, while analysing alerts about an attempted fraud and cases of multiple payments.

KYC modification

There were instances where KYC details were modified by fictitious establishments across the country. A total of 3,925 claims were put on hold for this reason in November 2021.

Further investigation led to detection of fraudulent withdrawals by modifying KYCs in the regional PF office in Chandigarh involving 38 claims of ₹1.83 crore. The data also led to detection of multiple payments in the same bank account for 1,297 claims of ₹1.57 crore.

The concurrent audit also found that 418 establishments were taking benefits under the AtmaNirbhar Bharat Rozgar Yojana (ABRY) at the rate of 24 per cent although they were eligible only for 12 per cent. This involved ₹60.21 crore.

Fraudulent ABRY benefits taken by 11 fictitious establishments based in Pune and Delhi involved another ₹1.17 crore.

Pension fraud

In another instance, multiple payments in the same bank account were found, that led to the detection of a major pension fraud in Maharashtra State Co-operative Cotton Growing Marketing Federation. The total contribution received for 395 multiple payment claims was ₹2.8 lakh while the total withdrawal benefit paid to these employees was ₹73.97 lakh.

Apart from these, the EPFO’s Concurrent Audit Cell (CAC) issued 14.9 lakh alerts involving ₹42,072.98 crore in 2021-22. This was up sharply from 4.61 lakh alerts in 2019-20 worth ₹4,027 crore and 10.01 lakh alerts entailing a sum of ₹35,621 crore in 2020-21. “The impact of the concurrent audit alerts is evident from the decreasing cases of irregular payment,” the Annual Report observed, adding that there has also been an increase in the recovery amount due to these alerts.

Concurrent audit in the EPFO was launched in August 2017 for systematic and timely examination before transactions are completed to ensure that they are accurate and comply with procedures.

This audit cell looks at 10 functionalities through which office-wise alerts on claims are downloaded and analysed on a daily basis. These include date of birth and name change, multiple payments in the same account, payments from dormant accounts and high-value claims.

Related Topics
comment COMMENT NOW