In Farrukhabad, Uttar Pradesh, a major fraud has been uncovered within the Prime Minister's Crop Insurance Scheme (PMCIS), leading to the booking of 44 individuals, including nine bank managers, three insurance company employees, and 32 farmers. The elaborate scheme involved the fraudulent transfer of ₹68 lakh to 35 farmers who were falsely identified as landowners, including 14 landless farmers, violating the established rules of the PMCIS.
The case came to light following the 2024 rabi season, during which HDFC Ergo served as the insurer for 8,849 farmers in the region. After reported crop damages, the insurance company disbursed ₹2.28 crore in claims to 232 farmers. However, District Magistrate Ashutosh Kumar Dwivedi initiated an investigation into the landholdings of farmers who received insurance compensation exceeding ₹1 lakh, raising suspicions about the legitimacy of the claims.
The investigation, conducted by the naib tehsildar, kanungo, and ADO (agriculture), revealed that 35 farmers did not possess land at the locations specified in their insurance claim records. Notably, in the Balipatti Rani gram panchayat within Amritpur tehsil, 14 out of the 15 farmers who received crop insurance claims were found to be landless. These 14 farmers were collectively paid ₹24.89 lakh. In one instance, a farmer who owned a mere 0.026 hectare of land received ₹2,57,160, significantly higher than the entitled amount of ₹2,228.
The scale of the fraud has raised serious concerns about the integrity of the crop insurance program and the potential for abuse. Misrepresentation of actual interests in crops is one of the forms of fraud insurers have identified in reported cases. Authorities are now focusing on determining the extent of the conspiracy and the roles played by each of the accused individuals. The investigation aims to identify the loopholes that allowed landless farmers to receive compensation, as well as the involvement of bank and insurance officials in facilitating the fraudulent claims.
This incident is not the first of its kind, as crop insurance fraud has been a recurring issue, costing taxpayers millions of dollars. A Colorado case involved farmers tampering with rain gauges to falsely indicate drought conditions and receive inflated insurance payouts. In North Carolina, farmers concealed their actual tobacco production to claim insurance payouts for failed crops, highlighting the diverse methods employed in these schemes.
The booking of the 44 individuals in Farrukhabad underscores the need for stricter oversight and more aggressive measures to combat fraud within the federal crop insurance program. Implementing robust verification processes, enhancing data analytics to identify suspicious claims, and increasing coordination between banks, insurance companies, and agricultural departments are crucial steps to prevent future occurrences. The outcome of this case will likely have implications for the broader crop insurance system, potentially leading to reforms aimed at safeguarding the interests of genuine farmers and protecting public funds.
