Jammu October 18, 2025: The Central Bureau of Investigation (CBI) has arrested a section-officer (Legal) of the Jammu & Kashmir and Ladakh Finance Corporation (JKLFC), Jammu, for allegedly demanding a bribe of ₹ 80,000 in connection with the settlement of a loan to an MSME requester. The accused is said to have accepted an initial instalment of ₹ 20,000 via UPI as part of the trap laid by the agency. 
According to the CBI release cited by various media houses, the complaint was lodged with the agency that the JKLFC officer demanded ₹ 80,000 from the applicant in order to process the file related to the settlement of an MSME loan of ₹ 51 lakh. 
During negotiations, the bribe amount was settled at ₹ 80,000, with first instalment of ₹ 20,000. 
On Friday, the CBI laid a trap and caught the accused in the act of accepting the ₹ 20,000 via an online UPI transaction, on a mobile number furnished by him, related to the MSME-loan settlement process. 
The remaining amount was to be paid after a “favourable decision” was taken in the case. 

The arrest highlights concerns over corruption in institutional loan-settlement processes, especially in the MSME sector, which is key for employment and regional economic development in Jammu & Kashmir.
The use of digital payment (UPI) in the bribe-transaction illustrates evolving modus operandi and reinforces the value of technology-enabled traps by investigative agencies.
The high value of the underlying loan (₹ 51 lakh) paired with the comparatively moderate bribe amount suggests potential systemic leverage of officials over such files — an area for administrative audit and reform. Public confidence in JKLFC and in the MSME financing ecosystem may be impacted; prompt investigation and transparent follow-through will be important to restore trust.
As the investigation is underway, the CBI will file charges under the relevant sections of the Prevention of Corruption Act, 1988 (or other applicable statutes) once the investigation completes key evidence-gathering.
The accused has been produced before the designated court for remand.
The loan file pertaining to the ₹ 51 lakh MSME loan may be subject to internal review by JKLFC/administration and any irregularities in process audited.
The CBI investigation may expand to see whether there are other officials or cases involving similar demands inside JKLFC or parallel institutions in the region.
Stakeholders in the MSME sector will likely monitor whether the system imposes safeguards to prevent such demands of “undue advantage”.
