HDFC Bank Faces Securities Fraud Lawsuit Over Alleged Deposit Scheme

The lawsuit, filed by Hagens Berman, centers on allegations that HDFC Bank executives—including CEO Sashidhar Jagdishan and CFO Srinivasan Vaidyanathan—orchestrated a scheme to circumvent Reserve Bank of India interest rate regulations. The bank reportedly funneled approximately Rs 45 crore (roughly $4.7 million) to the Maharashtra State Road Development Corporation to secure large deposits. To mask these costs, the firm allegedly disguised the payments as marketing expenses for a road safety campaign, effectively providing the state firm with a 6.01% interest rate that exceeded standard retail terms.

The investigation into these practices gained momentum following the March 2026 resignation of Chairman Atanu Chakraborty, who cited a divergence between bank practices and his own ethical standards. That departure triggered a 7.28% decline in HDFC American Depositary Shares. Further scrutiny arrived in May 2026 when an investigative report exposed the internal vigilance probe, leading to an additional 4.1% drop in share value. Hagens Berman partner Reed Kathrein stated that the firm is investigating whether leadership misled shareholders by projecting an image of strong governance while allegedly breaching anti-corruption policies.

Investors who purchased HDFC securities during the class period and incurred losses have until October 13, 2026, to apply for lead plaintiff status. The firm is also encouraging whistleblowers with non-public information to come forward, citing potential rewards under SEC programs for those providing original information regarding the alleged misconduct.