DNA Explainer: What is Jharkhand Scholarship Scam that has duped students of Rs.10 crores

As the shocking Scholarship Scam rocks the state of Jharkhand, the first set of 11 FIRs in connnection with this scam have been filed in the state's Dhanbad district.

This FIR is filed after an investigation by The Indian Express into the illegal diversion of the Centre’s pre-Matric scholarship for poor minority students for the academic year 2019-20. 

The Pre-Matric Scholarship Scheme is meant to help students of minority communities namely Muslims, Christians, Sikhs, Parsis, Jains and Buddhists from families with annual income below Rs.1 lakh. 

A case has been filed against 107 people including 98 school principals in the Rs.10 crores Jharkhand Scholarship scam. The FIRs have been filed under IPC sections on cheating and forgery, including 420, and criminal conspiracy. However no arrests have been made yet in this regard. 

The FIRs include the names of two district welfare officials who have been associated with the screening of scholarship applications, a mastermind and his two associates, five school principals who have been accused of creating fake beneficiaries, a local advocate and a mother of two who has gone missing.

According to the FIRs filed, it is alleged that these accused have lured innocent people to become 'fake beneficiaries', 'submitted fake KYC documents' at the welfare office and bypassed verification with help from officials to get schools registered on the National Scholarship Portal (NSP).

The FIR also names a woman who has been identified as an agent in Dhanbad, as part of the nexus based in the state’s Chatra district with operations in Bihar as well.

Nine people figure among the key accused - Vinod Paswan and Ajay Mandal, who are staffers in the District Welfare Office; Nilofar Parveen, an agent; Pratap Jaswar, Jharilal Mahato, Kalim Akhtar, Santosh Vishwakarma and Abdul Hamid, who are school owners or principals; and, Ghulam Musatafa, an advocate at the Dhanbad court.

The FIRs name Chatra resident Mohammad Sadiq as the alleged kingpin, and his associates Abul Faisal and Amjad. 

Dhanbad was among the six districts in Jharkhand, apart from Ranchi, Latehar, Ramgarh, Lohardaga and Sahibganj, where the nexus set up fake beneficiaries, while genuine applicants were left out.

The Indian Express matched entries on the NSP with beneficiary bank accounts in the Public Finance Management System (PFMS) to find several cases of the scholarship being illegally diverted in Jharkhand and Bihar. It found that the scam also roped in schools from Punjab and Assam.

The FIRs in Dhanbad state that the local link is Parveen whose husband is in Saudi Arabia and who stays with their two children in Nichitpur Township, around 20 km from the city.

The FIRs include statement from Parveen, which was recorded in an inquiry report prepared by the ADM-led team, revealing how the scam was carried out. 'Sadiq, Fazal and Amzad used to get User IDs and passwords from many schools. Once the scholarship money was credited in fake accounts, Sadiq used to give cheques to many middlemen, school principals, etc.,' it states.

FIR also states that Faisal allegedly handled the money for 'field operations' that involved school authorities. According to the FIR, Amzad a computer operator, allegedly made KYC forms for applications and filled the forms on behalf of school authorities.

Under the scholarship, students from Class 1 to 5 receive Rs 1,000 per year, and students of Class 6 to 10 receive Rs 5,700 a year if they are day scholars or Rs 10,700 if they are in a hostel. Most of the corruption, The Indian Express found, is related to these last two categories.

According to Parveen’s statement, Sadiq allegedly claimed that 'he had contacts in the district and state level'. It states that Parveen’s role was to submit copies of KYC documents at the Welfare office for verification after which school authorities would obtain User IDs and passwords and hand them over to Sadiq. 'Sadiq operated in Ranchi, Sahibganj and Dhanbad in Jharkhand, and Aurangabad and Arrah in Bihar,' it states.

The Ministry of Minority Affairs said that in 2019-20, it disbursed Rs 61 crore to Jharkhand under the pre-matric scholarship scheme. Around 203,628 students applied and 84,133 students got the scholarship, as per the Ministry’s data.

In 2018-19, Jharkhand received Rs 34.61 crore and 166,423 students applied, only 50,466 students got the scholarship. In India, for the academic year 2019-20, Rs 1423.89 crore was disbursed for Pre-Matric Scholarship.

The Union Ministry of Minority Affairs, which administers this scholarship has decided to ask the CBI to investigate into the matter. Police in Bihar’s Gaya have also registered an FIR.

Earlier this month Jharkhand Chief Minister Hemant Soren gave orders of probing the scholarship scam to the Chief Secretary. The Jharkhand Chief Minister also called a special session of the Assembly on November 11 regarding this matter.