Fraud syndicate dupes 500k people of ₹150 cr
More than half a million Indians were cheated of over ₹150 crore in two months allegedly through an online multilevel marketing (MLM) scheme that was floated by Chinese nationals in connivance with Indian fraudsters, the Delhi Police said on Wednesday.
Police said the syndicate offered lucrative returns on the scheme that was being operated through two “malicious mobile applications”, Power Bank and Ezplan.
Eleven people, including a Tibetan woman and two chartered accountants (CAS) based in Delhi and Gurugram, were arrested following multiple searches in Delhi-ncr and West Bengal since June 2.
The footprint of the syndicate was confirmed in West Bengal, Delhi-ncr, Bengaluru, Odisha, Assam, and Surat, the police said.
Nearly ₹11 crore accumulated by the group was blocked in various bank accounts and online payment gateways that were being operated by the members of the syndicate based in India and China.
Around ₹97 lakh was recovered from two arrested chartered accountants, one of whom has been identified as Avik Kedia, who formed over 110 shell companies for Chinese fraudsters to route the money through multiple bank accounts, deputy commissioner of police (cyber crime cell, CYPAD) Anyesh Roy said. Roy said officials from the Cyber Prevention, Awareness & Detection Centre (CYPAD) recently came across several social media posts by people from across the country regarding mobile apps Power Bank and Ezplan that offered to double investments in 24-35 days.
The apps also offered returns on an hourly and daily basis and had investment options starting from ₹300 and going up to several lakhs.
The Power Bank app was available on Google Play Store,
NEW DELHI:
Money fraudulently taken from investors
llllNumber of people duped
The Chinese handler hired Indian suspects on messaging apps
The accused created apps such as Power Bank, Zcoin, Sun Factory to get people to invest money, and steal their phone data
Users were repeatedly asked to invest money and encouraged to invite their friends and relatives to join the app
A countrywide network, including CAS, was set up to launder the money while Ezplan app was available on the website www.ezplan.in.
DCP Roy said since messages were inducing people to download these apps, the activity was identified as suspicious and the malware forensic lab of CYPADNCFL was asked to examine the apps.
“When analysed, CYPAD officials found that to deceive people, the Power Bank app projected itself as a product of a Bengaluru-based technology start-up. However, the server on which the app was hosted was found to be based in China.
The app was seeking several dangerous permissions such as “access to phone camera”, “read and write to external storage”
Amount frozen in 11 bank accounts
llllMoney recovered from two arrested CAS
Don’t download unverified apps Don’t get swayed by claims of exorbitant returns or profits Never forward links of such apps to your contacts
Report such frauds to police and financial institutions and “read contact details”,” said Roy.
To entice investors, the fraudsters initially gave a small payout amounting to 5%-10% of the invested money.
This made investors believe that the scheme was genuine and they started investing more money as well as sharing the apps with their friends and relatives.
Once someone invested a large amount, their account was blocked by the app, thus causing a severe financial loss to the investor, police said.
To identify and nab the people behind the scam, a CYPAD officer became a decoy customer, invested a token amount using the app and followed the money trail. The linked payment gateways, UPI IDS, transaction IDS, and bank accounts that were used for routing the money were identified and analysed. A web of nearly 25 shell companies for routing the money were traced across the country and it pointed to the involvement of professional accountants. Several mobile phone numbers connected with the bank accounts and involved in the scam were found to have Chinese origins, said Roy.
“Further analysis of mobile numbers active in India led to the arrest of Sheikh Robin from West Bengal’s Uluberia on June 2. The same day, nine other suspects were arrested, and a Tibetan woman, Pema Wangmo, was arrested later from Delhi’s international airport, following inputs from the Bengaluru police that is also probing a similar module. She was acting at the behest of her Chinese handlers and creating shell companies with Indian directors,” Roy said.
The other arrested persons were identified as Kedia and Ronak Bansal, both chartered accountants, Umakant Akash Joys, Ved Chandra, Hari Om, Abhishek Mansaramani, Arvind, Shashi Bansal and Mithlesh Sharma. At the time of his arrest, Robin had 29 bank accounts and 30 active cellphones. His disclosure revealed a startlingly wellplanned conspiracy of cheating and fraud organised by Chinese nationals through a labyrinth of shell companies, bank accounts, and dummy mobile numbers, the DCP said.
“The Chinese fraudsters contacted Robin and others through encrypted mobile apps such as Telegram, Dingtalk and Wechat. The Chinese fraudsters and their local operatives also used sophisticated software and financial tools for automated fund transfer. Names of several Chinese nationals have been revealed so far. Investigation in respect of their whereabouts, specific roles and their network is underway,” added DCP Roy.