The BJP on Thursday demanded a Central Bureau of Investigation probe after the Comptroller and Auditor General (CAG) identified suspected irregularities worth $225 crore in the state’s flagship welfare scheme Gruha Lakshmi, including payments to deceased beneficiaries, duplicate bank accounts and gaps in beneficiaries’ records.
Opposition leader R Ashoka described the alleged fraud as a “state-sponsored cybercrime” and called for a probe by the CBI and central agencies to combat cybercrime. BJP state president Vijayendra Yeddyurappa also sought a transparent and high-level probe, alleging that the scheme has turned into a massive scam and seeking accountability for beneficiary verification and money transfers.
The review, covering implementation of the scheme in 2023-24 and 2024-25, found that $Rs 116 crore through installments of Rs 5.79 lakh were transferred to the accounts of 1.08 lakh beneficiaries who died after the commencement of the scheme. The CAG said 2.88 lakh beneficiaries died during the review period, but replacement beneficiaries from the same families were registered in only 1.03 lakh cases.
The auditor also found that management did not provide records relating to 77,376 deceased beneficiaries and sought clarification on whether payments continued after their deaths and why safeguards failed to prevent this omission.
The CAG identified 19,020 beneficiaries linked to the joint bank accounts it received $60.70 crore through 3.03 lakh payments, raising questions as to how so many beneficiaries could share the same account.
I also found it $Rs 46.52 crore was disbursed without recording the beneficiary or bank account details in the database and the Women and Child Development Department was asked to identify the recipients and explain how these payments were processed.
Of the 1.23 crore beneficiaries of the scheme, the audit found that 10.06 million people have more than one bank account. In some cases, payments were made to multiple accounts belonging to the same beneficiary, while others repeatedly changed their account details before returning to previous accounts. Bengaluru alone accounts for 1.15 lakh beneficiaries from multiple accounts.
The audit also identified recurring deposits amounting to approx $1.80 lakh crore in 8,995 bank accounts, indicating duplicate installments.
Gruha Lakshmi Scheme provides eligible women $2000 every month and was disbursed $75,000 crores since its launch.
The CAG informed the Department of Women and Child Development of its preliminary findings after analyzing beneficiary data through a data dump programme. She said in a report to the department: “Although you wrote a letter several months ago to provide clarification in this regard, you show negligence by not submitting the report.” The Department Secretary then instructed the subordinate officers to submit the compliance report immediately.
Ashoka alleged that beneficiary records and software algorithms were manipulated to direct funds to accounts owned by deceased beneficiaries and facilitate repeated transfers to the same accounts. “The irregularities came to light through analysis of data dumps of departmental records rather than routine verification. Software algorithms were manipulated to transfer funds to accounts owned by deceased beneficiaries and facilitate recurring payments into the same bank accounts,” he said.
He also questioned why records relating to 77,376 deceased beneficiaries had not been brought before auditors, asking whether efforts were being made to alter or erase cyber records associated with those accounts. He called on investigators to trace the IP addresses from which the alleged manipulation was made and determine the network through which the money was allegedly transferred.
The Karnataka government is yet to respond to the latest allegations.
KPC Chairman BK Hariprasad said the government was reviewing the records of beneficiaries. “Some people have abused the system in the name of people who are no longer in this world, people who have changed their addresses. That’s why the prime minister said they will review the beneficiaries,” he said.
