AI powered audits reveal large scale fraud across several Indian states, Full details 2025
AI powered audits reveal large scale fraud in state welfare schemes, enhancing transparency, improving governance, and boosting accountability across government departments.
AI powered audits reveal large scale fraud
The Comptroller and Auditor General of India (CAG) has started using Artificial Intelligence (AI) and Machine Learning (ML) to uncover large-scale fraud in state welfare schemes. CAG K. Sanjay Murthy shared this development during the second State Finance Secretaries Conference in 2025. With the help of AI and ML, the auditing system is becoming faster, more accurate, and more transparent, helping government departments improve accountability.
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How AI and Machine Learning Are Changing Auditing
The CAG’s office is now using AI and ML for forensic audits. With these tools, fraudulent transactions can be detected faster and with greater accuracy. AI/ML audits analyze huge amounts of data, highlight unusual patterns, and cut down on human errors. This modern approach helps save public money by stopping the misuse of funds in state welfare schemes.
Remote Audits and Digitisation Making Auditing Smarter
The CAG is giving high importance to digitising audit processes. With remote audits, officials can review records without being physically present, which reduces travel and paperwork issues. This approach makes audits faster, more efficient, and allows wider coverage—like checking the entire GST and income tax databases. However, successful remote auditing depends on government departments fully digitising their records and data.
Also Read : PM Narendra Modi Launches Next Generation GST Reforms for Savings and Self-Reliant India
Digital Public Finance Systems Are Expanding in India
State governments are rapidly shifting to digital tools for managing public finances. Platforms such as the Integrated Financial Management Information System (IFMS), online e-Procurement systems, and the Digital India Land Records Modernisation Programme are boosting transparency. These digital solutions make it easier to monitor government spending, curb corruption, and ensure greater accountability in financial operations.
Government Initiatives Driving Digital Audits
Programs like SNA SPARSH focus on improving government cash management, while Special Assistance to States for Capital Investment helps develop IT infrastructure. These initiatives make it easier to implement digital finance systems and strengthen the ability of states to manage public funds efficiently and transparently.
Also Read : Muzaffarpur Takes the Lead in Promoting Innovation Among Students, INSPIRE Award Scheme 2025
How AI and Digital Tools Strengthen Public Accountability
The use of AI/ML and digitisation in audits marks a shift towards data-driven governance. Increased transparency deters fraudulent activities. Greater accountability strengthens public trust. These technological advances contribute to efficient use of resources and improved delivery of welfare schemes.
