In an unusual move for the country’s premier investigation agency, the CBI has registered a complaint against 15 people for allegedly claiming fraudulent refunds worth Rs 6. 15 lakh from payment gateway Paytm. The FIR was registered on a complaint from the company under various sections of the Indian Penal Code (IPC) and the Information Technology (IT) Act.
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It is rare for the CBI, overburdened with work and short-staffed, to take up such cases as Paytm is neither a government financial institution nor is its loss connected to the exchequer. Legally, however, the agency has jurisdiction over such cases, which fall under union territories and the IT Act. The registered office of Paytm’s parent company One97 Communications is at Nehru Place in New Delhi even though the company has its headquarters in UP’s Noida.
According to an agency spokesperson, “The CBI can register cases under IT Act in the territory of Delhi even on complaints from and against private individuals. This has been happening since 2000.”
But the spokesperson declined to respond to a question on many such cases the agency had registered. A CBI official said that the agency has investigated complaints from Paytm and private banks such as ICICI Bank in the past, too.
Incidentally, the CBI has repeatedly pleaded with courts, including in the case of the Vyapam scam, to not hand over cases to it as it is overburdened and saddled with vacancies.
“While the CBI can legally investigate all IT fraud cases in Delhi, it is rather unusual for it to entertain a private complaint of merely Rs 6 lakh of fraud. Such complaints are generally dealt with by Delhi Police,” said a former CBI officer.
In the FIR registered Thursday, the CBI mentioned as suspects 15 customers of the $5 billion digital wallet company and unknown officials of Paytm, all residents of Delhi.
The complaint from the Paytm’s Manager (Legal), M Sivakumar, claimed that the company makes payment for defective products received by customers and arranges for pickup of the damaged product which is sent to the merchant. The process is done by a team of customer care executives who have been assigned specific IDs and passwords to handle such complaints.
The company alleged that between 2014-16, customers in 48 cases received refunds even though the delivery of orders was deemed successful. “Wherein delivery of orders were successful and satisfactory to the customer, refund should not happen. However, in all these 48 cases, refund of order amount happened to the respective customers to the tune of Rs 6.15 lakh,” the complaint, which is now part of the FIR, alleged.
A Paytm spokesperson said, “Paytm has identified about 48 fraudulent users in the physical goods marketplace business, who were trying to game the company’s consumer friendly practices. Paytm regularly monitors its marketplace business to identify any fraudulent or suspicious behaviour. This is a part of the company’s security practices to ensure that genuine users are able to continuously avail the benefits brought to it by Paytm marketplace. Paytm marketplace has robust risk management practices and regularly reports users who try to game the company’s fair usage policies.”
Its complaint to the CBI has alleged that customers “illegally” appropriated money refunded in their bank accounts and e-wallets.
The digital wallet company, which got a big boost in transactions after demonetisation of Rs 500 and Rs 1,000 notes announced by Prime Minister Narendra Modi on November 8, claimed that the accused got details of the internal workings of the company before executing their plans.
The company alleged that most of these customers had taken deliveries of products at common or similar addresses.
Naming the customers in the FIR, the company claimed that they may have played an instrumental role in the fraud, may be known to each other and part of a larger conspiracy.
The company alleged that in cases where refunds were made, money was further transferred from e-wallets to the bank accounts of either the accused or those known to each other. The company claimed that the refunds were made within five to six minutes of disputes being raised by the customer.