IndusInd Bank flags fraud of Rs 172.58 cr, says certain employees played major role in recent accounting lapses
IndusInd Bank
on Wednesday disclosed a suspected case of internal fraud involving its microfinance operations, with Rs 172.58 crore wrongly recorded as fee income across three quarters in the financial year 2024–25. The irregularity came to light following investigations by an external professional firm and the bank's Internal Audit Department (IAD).
The IAD has on May 20, 2025 submitted its report which determines that a cumulative amount of Rs. 172.58 crores was incorrectly recorded as fee income in the microfinance business over three quarters ending December 31, 2024 and reversed in Q4 of FY 24-25, said the bank in an exchange filing.
The bank reported its first quarterly loss in at least 18 years today and said that it suspects that some employees had engaged in fraud that led to accounting lapses, which weighed on its results.
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IndusInd, India's fifth-biggest private lender by assets, disclosed in March that years of incorrect accounting of internal derivative trades led to a $230 million hit to its accounts for the financial year ended March 31.
Its CEO, Sumant Kathpalia, and deputy, Arun Khurana, stepped down last month.
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Separately, earlier this month, it flagged that an internal audit of its microfinance business found that a sum of around $80 million was incorrectly recorded as interest over three quarters of fiscal year 2025, and that the amount was fully reversed in January.
"Board suspects the occurrence of fraud against the Bank and the involvement therein of certain employees having a significant role in the accounting and financial reporting of the Bank," IndusInd Bank said in a statement on Wednesday.
It said its fourth-quarter results accounted for the impact of all discrepancies identified in probes into these cases.
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