How Chinese fraudsters used Indian digital ad companies to lure Indians in ‘trading scam’ on social media

DCP (Cyber) Purshottam Karad said they have arrested four persons, including Gigil Sebastian, the finance head of a Bengaluru-based digital advertisement company Valueleaf India Services Private Ltd along with three other employees of the company. One of them is from Thane. The company earned Rs 3 crore from the Chinese masterminds in Indian and Dubai currency, police said.

Chinese fraudsters targeting Indian nationals do not have access to Facebook and Instagram, and rely on Indian digital ad agencies to place fake ads to snare victims.

Suvarna Shinde, senior inspector of west region cyber police, said Valueleaf had provided their Meta advertisement ID — unique ID given to a company — to the Chinese fraudsters even though they were aware it was being used to upload deepfake videos on social media platforms.

Shinde said these videos would show credible names in the finance world giving tips on investments and asking those interested to click on more links. These people would then be added to WhatsApp groups.

Over a period of time, the fraudsters make the victims invest money through their platforms promising high rates of return. When the victims seek their money back, the fraudsters remove them from the group.

“Thousands of Indians have lost money in these scams. We always wondered how fraudsters zero in on whom to dupe. It now appears that they targeted people who clicked on these videos. With the arrests, we are hitting right at the base of where the fraud begins,” Shinde said.

Karad said they suspect Chinese fraudsters are using the services of several Indian digital marketing agencies, and warned them to stop it as they can be arrested.

An official said while those arrested claimed they were not aware that their services were used to upload fraudulent videos, the accused should have first verified the bonafides of the Chinese nationals before giving them their ad Ids, which is anyway against Meta policies. “Also, once the deepfake videos were put up using their ad ID, it was clear that it was used to defraud people and they still took no action. Meta platform also displayed a yellow flag next to these videos clearly indicating they were deepfakes. However, in spite of that they did not take any action,” an official said.

The fraud came to light last month when a SEBI-registered research analyst and stock market expert approached the Mumbai police alleging that his video had been used as a deepfake to promote some companies. The police began investigation in the matter which led them to the Bengaluru-based digital company.

The arrested accused, apart from Sebastian, includes Dipayan Tapan Banerjee (30) and Daniel Arumugham (25), all residents of Bengaluru. One Chandrashekhar Bhimsen Naik (42), a Thane (east) resident and employee of the company, was also arrested. The accused were produced before court and remanded in police custody till Monday.

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