PESHAWAR – A major financial scandal involving embezzlement of over Rs106 million has been reported from Khyber Pakhtunkhwa in a World Bank–supported development project.
As per official records, the funds were withdrawn from KP Human Capital Investment Project (KP-HCIP) account on July 3, 2025, even though provincial finance department had frozen all project accounts between June 25 and July 24 for the start of the new fiscal year.
Project Management Unit (PMU) accused government bank of clearing three fraudulent cheques, two of them sharing the same number. without verifying them with either the PMU or Accountant General’s Office. The cheques were processed through the Peshawar Cantt branch and included: Rs48.7 million, Rs55.3 million, and Rs1.96 million.
Project Director Asif Shahzad said fake cheques, fabricated authorisation letters, and forged reference numbers were used in the scam. He stressed that the PMU had not requested or issued any new cheque book, raising questions about how the fraudulent instruments were obtained.
Official raised questions, calling it case of “systemic negligence,” and urged bank’s senior management to involve Federal Investigation Agency (FIA) and ensure recovery of the stolen money. PMU has also demanded that all officials responsible for lapses be identified and face criminal proceedings.
A regional executive of the bank confirmed an inquiry has been launched. He noted that while the cheques were cleared by a government bank, the withdrawals were carried out through a private bank. He added that investigators were also looking into whether project insiders may have been involved.
KP-HCIP, worth Rs26 billion, is a flagship initiative funded with World Bank assistance to improve human capital in the province.
