KP Faces Rs. 106 Million Financial Scam in World Bank–Funded Project
PESHAWAR, Sept 12 – A financial scandal worth over Rs. 106 million has been uncovered in Khyber Pakhtunkhwa, involving the alleged misuse of funds from a World Bank–supported project. The case highlights forged documents, fake authority letters, and suspected collusion with a government bank.
Funds Withdrawn Despite Freeze
According to official records, the funds were withdrawn on July 3, 2025, even though the provincial finance department had frozen all project accounts from June 25 to July 24 for the start of the new fiscal year 2025–26.
The Project Management Unit (PMU) of the Khyber Pakhtunkhwa Human Capital Investment Project (KP-HCIP) reported that fraudulent cheques and fabricated reference numbers were used to release the money. Shockingly, the bank in question processed the cheques without proper verification.
Fraudulent Cheques Exposed
Documents revealed that three cheques from the project’s Revolving Fund Assignment Account were fraudulently cleared through a Peshawar Cantt branch:
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Cheque No. 1326903725 – Rs. 48,760,245
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Cheque No. 1326903733 – Rs. 55,320,306
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Cheque No. 1326903733 (duplicate) – Rs. 1,964,028
The repeated cheque number, identical reference details, and counterfeit signatures raised further red flags. Fake authority letters cited the same reference number: PMU/KP-HCIP/EASED/Release/2025 dated June 20, 2025.
PMU Demands FIA Inquiry
Project Director Asif Shahzad confirmed the irregularities, noting that the PMU had not issued a new cheque book or authorised anyone to use it. He strongly criticised the bank for failing to verify the documents with the PMU and the Accountant General’s Office before clearing such large transactions.
Calling it a case of systemic negligence, the PMU has urged the Federal Investigation Agency’s (FIA) Banking Circle to investigate and recover the stolen amount.
Bank Responds
A senior bank official acknowledged receiving the complaint and confirmed that an inquiry is underway. While the cheques were processed by a government bank, the funds were reportedly withdrawn through a private bank. He added that collusion by insiders could not be ruled out at this stage.
Project Background
The KP-HCIP, worth Rs. 26 billion, is being implemented with World Bank assistance to improve human capital investment in the province. The scandal has now raised serious concerns over financial accountability and monitoring in donor-funded projects.
