Digital arrests have reached the doorstep of the National Consumer Commission.
For the first time, a clutch of banks received notices from the National Consumer Disputes Prevention Commission, stating that the victims of digital arrest fraud have been subjected to “deficiencies in service”.
Petitions filed by Digital arrest victim Admitted in an order on 3 March and on 7 July.
Banks’ answers were heard by the NCDRC Bench which included the chairman of the commission, AP Sahi, and member Bharatkumar Pandya.
The NCDRC bench has said that it would consider taking assistance of central government agencies such as the Financial Intelligence Unit (FIU) and the Ministry of Cyber Crime Coordination of the Ministry of Home Affairs (I4C), the Cyber Crime Coordination Center of the Ministry of Home Affairs, it should be decided that complaints before the Commission were “maintainable”.
Petitions of two Gurugram victims – who lost Rs 10.30 crore and Rs 5.85 crore in Digital Arrest Scam last year – clubs together for the NCDRC case; A third case of Mumbai will also be heard at the next hearing fixed for 14 November.
Advocate for the three victims Mahendra Limay said that the Mumbai victim had lost Rs 5.88 crore after facing digital arrest last year.
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Limay told The Indian Express, “It is important that the bench of the Consumer Commission has sent notices to all banks in the series of digital arrests including beneficiary banks. The allegations of violations and shortage of violation of the guidelines of the Reserve Bank of India (RBI) will now be heard in detail for the banking sector.”
The order makes it clear whether the issue of the arguments of digital arrest comes within the definition of a “consumer grievance” and what will be the “strange jurisdiction” to entertain such complaints, there are two issues that will be heard.
In its March 3 order, the NCDRC bench has stated that the allegations they were investigating “had a clear compromise” and “RBI guidelines were violated and no customer security care was taken.”
The order stated: “The guidelines for checking the unauthorized electronic banking transactions are controlled by circulars and it appears that the accounts that have been transferred by the complainants seem to take any precautions to those accounts without taking any precautions and no alert or red flag was taken up for any kind of banks.
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Banks whom notices have been sent and many of which were represented during the July 7 hearing: ICICI Bank, HDFC BankUCO Bank, Federal Bank, Srinivas Padmavati Bank, Yes Bank, State Bank of India and Kotak Mahindra Bank,
As Reported in a search chain In The Indian Express In June and July, the number of digital arrest frauds in India jumped up to 1,23,672 cases in 2024, with an amount of Rs 1,935 crore from the victims.
The case of one of the Gurugram victims – which is now before the NCDRC and had lost Rs 5.85 crore – was investigated to show how the money was transferred by the fraudsters, which was taken to 141 accounts located across the country.
The amount was sometimes deposited from one bank to another within seconds and minutes. The fact is that a single fictional or mule account was used for many cyber fraud.
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