HC orders Police chief to investigate Rs 200-crore theft

The money was stolen by cloning ATM cards.

Written by Sumegha Gulati | New Delhi | Published: July 14, 2014 2:27:10 am

Setting an example for other courts to nip plastic-money crime in the bud, the Delhi High Court directed the Delhi Police Commissioner to investigate an “ATM card cloning” matter in which the complainant lost more than $ 39 million (over Rs 200 crore). The complainant in the case — a software developer — had approached the Economic Offences Wing of the Delhi Police in June 2013, alleging that his computers had been hacked and ATM cards had been cloned to withdraw more than $ 39 million.

Noting the “magnitude and complexity” of the alleged crime, the High Court said “no visible progress had been made” in the case in the last one year. “This court is of the opinion that since India is one of the leaders in the Information Technology industry, it is imperative that the alleged crime should be investigated by police with ‘alacrity’. Consequently, the Commissioner of Delhi Police is directed to personally examine the matter and ensure that the complaint is investigated expeditiously and properly,” Justice Manmohan said in an order earlier this week.

The High Court order comes at a time when cyber crimes and online fraud has become a major issue in the country. According to data provided by the Reserve Bank of India, nearly one-fourth of the complaints received by banking ombudsman in 2012-13 pertained to net-banking, ATM, debit and credit card frauds.

According to the data, banking ombudsman received 70,541 complaints in 2012-13, of which 25 per cent — 17,867 — pertained to netbanking and ATM, debit and credit card frauds. Over 21 per cent (14,492 cases) of the total complaints in 2011-12 and 24 per cent (17,116 cases) in 2010-11 pertained to plastic money fraud.

In a paper authored by RBI Deputy Governor K C Chakrabarty in July 2013, the total loss from technology-related fraud in the last four years, till March 2013, was put at over Rs 357 crore. Of this, over Rs 183 crore was reported from new private sector banks. Foreign banks reported a loss of over Rs 145 crore in the same period.

Chakraborty had said the predominance of the new private sector banks and the foreign banks in the number of such frauds was “intuitive” as they lead the technology enabled service delivery in the Indian banking sector. “There have been several instances wherein fraudsters have employed hostile software programmes or malware attacks, phishing, vishing (voicemail), SMSishing (text messages), whaling (targeted phishing on high networth individuals) apart from stealing confidential data..,” Chakraborty wrote in the paper.

Speaking to Newsline, an official in Delhi Police’s Cyber cell said instances of card cloning had increased as most fraudsters bought credit card information from online hackers. “Hackers often use information from bank accounts or email IDs of customers. Unfortunately, people do not even realise that their ATM or debit or credit cards have been cloned till they are notified of the theft. There are no detection mechanisms to tell if a card has been cloned,” the official said.

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