As a public service to the common man always gullible to all types of frauds, the Consumer Education and Protection Department, Reserve Bank of India guided by the office of Ombudsman, Mumbai-II has brought out a book on ‘BE(A)WARE – Be Aware and Beware!’, which leads us to all types of frauds so far unearthed by the Ombudsman, in its millions of complaints received from bank customers. No, it is not a filmi creation but a hardcore reality actually created by fraudsters using their unlimited imagination but placed on criminal hindsight’s. Extensive use of language from above booklets adorns this article which is an eye opener and the author guides you through the naivetes of RBI.

It is ideal we do learn the tricks of trade to safeguard our valuable financial resources. Right from a baby of 3 years to an elderly senior citizen up to 100 years should read, understand, and implement the precautions against fraudsters. (Yes, a small baby learns more from mobile than even from its parents)

1. Part A – Modus Operandi and Precautions to be taken against Fraudulent Transactions – Banks.

2. Part B – Modus Operandi and Precautions to be taken against Fraudulent Transactions – Non- Banking Financial Companies (NBFCs)

3. Part C- General Precautions to be taken for financial transactions.

Part A

1. Phishing links

What is the modus Operandi?

Fraudsters create a third-party phishing website which looks like an existing genuine website, such as – a bank’s website or an e-commerce website or a search engine, etc.

Links to these websites are circulated by fraudsters through Short Message Service (SMS) / social media / email / Instant Messenger, etc.

How does the crooks operate?

Clicking on above and entering PIN, OTP PW etc., enable the fraudsters to misuse the information.

Verifying the links of actual banks serving you and non-subscription to unknown websites help the actual client.

2. Vishing calls

 Modus Operandi ➢ Imposters call or approach the customers through telephone call / social media posing as bankers / company executives / insurance agents / government officials, etc. To gain confidence, imposters share a few customer details such as the customer’s name, date of birth etc. Recently, an African wrang me, called my name and asked about my web mail address when I threatened him of police action. The results are known to you.

Commercial banks with millions of client’s information hardly share any of them and hence the fraudsters should be identified by you easily.

3. Frauds using online sales platforms

Modus Operandi ➢ Fraudsters pretend to be buyers on online sales platforms and show an interest in seller’s product/s. Many fraudsters pretend to be defence personnel posted in remote locations to gain confidence.

Yes, by obtaining UPI pin, the fraudster obtains the payment to his account.

Yes, anything looking too good is another fraudulent attempt only.

4. Frauds due to the use of unknown / unverified mobile apps Modus Operandi ➢ Fraudsters circulate through SMS / email / social media / Instant Messenger, etc., certain app links, masked to appear similar to the existing apps of authorised entities.

Carried away by these mobile apps, most unwanted frauds are committed on gullible bank customers.

5. ATM card skimming

Modus Operandi ➢ Fraudsters install skimming devices in ATM machines and steal data from the customer’s card. We have heard, physically seen, or warned initially itself how fraudsters mostly young, and from some of the most backward districts of the nations attempting primary fraudulent techniques used extensively throughout the nation. Many of the bank customers lost huge sums of money by this way.

The good news is that banks have taken adequate steps to wade off this menacing predated technique. However, as a precaution why not cover with hand the pin dial while inputting the information. Also, one should verify the ATM numbering board does not any hidden extra device. However, it is the bank’s duty to protect its device.

Some of the others with extensive explanations available with page wise is as under:

Chapter Name Page
6. Frauds using screen sharing app / Remote access 10
7. SIM swap / SIM cloning 11
8. Frauds by compromising credentials on results through search engines 12
9. Scam through QR code scan 13
10. Impersonation on social media 14
11. Juice jacking (use of charging port of a mobile 15
12. Lottery fraud (an old way of getting information by telephone) 16
13. Online job fraud (most prominent fraud worth values in Rs Crores) 17
14. Money mules (Money Mule is a term describes innocent victims who are duped by fraudsters into laundering stolen / illegal money via their bank account) 18

Discussion

Can we explain in simple terms the precautions to be taken at all times, all days, months and years?

  • Unfortunately, all of us, seniors are forced to share our information through our relatives. Why not occasionally verify the bank accounts, what’s up messages, or telephonic conversations? Strictly prohibit telephonic instructions even to known ones. Why not email for conversation but PW protected periodically by personal intervention.
  • All the frauds numerated above do not predict any unknown territory but a bit of common sense with total selfishness saves one hard earned money. Instruments are easy to use, comfortable for transmission of funds, and equally enable any one to misuse with proper information.
  • How many of us did not hear the email theft of PWs, fraudulent messages asking of money from our relatives who just wished you a happy day in the morning in the same place but sitting in Antarctica for help by email message, that too repeatedly? Hardly, none.

Modus Operandi and Precautions to be taken against Fraudulent Transactions – Non- Banking Financial Companies (NBFCs)

 Part B

1. Fake advertisements for extending loans by fraudsters

        Operational details

Fake advertisements with lucrative rate of interest for deposits or on loans on minutes basis, all at lightening speeds invite financial disasters. How can one offer 2% return on properties when the whole market seems to be in total economic turbulence due to pandemic, Ukraine crisis, or the whole Western world in total economic chaos with huge unemployment, or millions of immigrants in other’s soil with no future?

2. SMS / Email / Instant Messaging / Call scams

Modus operandi

Some of the commonest simple techniques to lure customers

    • The fraudsters showing their Aadhar cards, websites all fakes, fake NBFC cards, circulating sanction letters, check with sanctioned amounts, or frequent telephones conveying sanction of loans with the highest courtesy are not uncommon. Many simple common con artists have perfected these techniques successfully and some of them have amassed hundreds of Rs Crores.
    • Call centers scams even purported to be of foreign countries with American accent/British accent have come aboard regularly at periodical intervals all sitting in Noida or Mumbai. Unclear to common sense why to get threatened by foreign tax authorities who refuse to deal with even your genuine telephonic calls due to pandemic or unnatural disasters. None of them believe in modern technologies to finish the transactions in minutes. That is the reason for none of the known frauds on IRS, CRA or British tax authorities.
    • Internal Revenue Service, CRA Canada or British revenue authorities never reveal or ask sensitive information like social security card numbers, details of visas, or vital employment information like employers, salary details etc without any adequate protocols.
    • None of the above regulatory authorities threaten with jail terms for non-payment of taxes. Indian tax system has imbibed face less technology which does not enable face to face contacts even on repeated requests. Nearly 5 crores of tax returns collected online without any human personal face contacts. Technology with a human touch without any body.

3. OTP based Frauds

Please ponder over the simplest way of taking a loan as per a fraudster with his inquisitive mind.

From the booklet,

“➢ Fraudsters impersonating as NBFCs, send SMS / messages offering loans or enhancement of credit limit on NBFC/bank customers’ loan accounts, and ask the customers to contact them on a mobile number.

 ➢ When the customers call such numbers, fraudsters ask them to fill forms to collect their financial credentials. Fraudsters then induce / convince the customers to share the OTP or PIN details and carry out unauthorised transfers from the customers’ accounts.”

So moral of this information from RBI is never share OTP even with family members, never write any confidential information like bank account, PW, PIN etc.

Why not contact directly the banks who generally do not give any service so easily since the manpower is either temporary, less trained, or looking for other jobs. But give safe information after proper authntification.

Anyway, as a customer you have a right to know the full information, and legally protected by various RBI guidelines to know the actual state of affairs. NBFC/ E – valent provider, their website or direct customer service would suffice.

4. Fake loan websites / App frauds

Can you imagine fake loan websites/App frauds and if not, please be aware of them, as per RBI counsel to us.

15 minutes loans, credited to your bank accounts with the loan amounts and the service charges debited to your loan amounts are some of the commonest tricks which I come across in my What’s up.

Can we believe reputed companies like Bajaj Finance, Sriram finance or TVS finance offer me liberal loans through SMS to my mobile and lure me for availing loans, as per daily information from my mobile alerts?

Correctly you have arrived at the conclusion that all these fraudsters misuse those whose names I have quoted for their gains. With millions attempting various nefarious techniques, why not contact these AAA rated companies for confirmation, if any, before one acts.

None of them, living in memory for decades offer cheap loans without proper protocols.

Beware of those fraudsters.

5. Money circulation / Ponzi / Multi-Level Marketing (MLM) schemes fraud

Pyramidal schemes do operate like one introducing another, gain commission from the work done by him, another in the line with sharing business commissions with the earlier ones, thus going back endlessly.

These schemes are banned in India.

6. Fraudulent loans with forged documents

Some NBFC employees, if they ask you about your accounts, PIN or any confidential information on phones, better be wary of this query and never reveal the information.

It is not uncommon to misuse forged documents, get the loans sanctioned, avail them and run away. Credit cards used to be the prime target earlier, even nationalized banks with least precautionary procedures used to avoid recording of frauds and were now caught by strict RBI directives to act firmly. I know of many of my customers affected by frauds in credit cards of leading private sector banks.

So, please exercise caution with any employee of any institution, however big it may be.

RBI ‘BE(A)WARE – Be Aware and Beware!’ – booklet on frauds

C- General Precautions to be taken for financial transactions

54 or more precautions under the following heads have been given on pages 26-32 with the best optimal care.

  • Precautions to be taken by depositors
  • How do you know whether an NBFC accepting deposit is genuine or not?
  • For password security
  • E mail account security
  • Precautions related to debit/credit cards
  • Factors indicating a phone is being spied (Recent charges in a leading financial institution is a relevant pointer for us. Yes, someone can spy your telephone for indulging in fraud)
  • For safe internet browsing/banking
  • For device/computer security

With all precautions, sermons like instructions, and prodding you to take seriously fraudsters and their myriad tricks, how to file a complaint?

For security reasons, let me quote directly from page 33 of booklet.

“Complaint to RBI Ombudsman ➢ For filing complaints online, please visit the link at https://cms.rbi.org.in/ ➢ Complaints by email can be sent to crpc@rbi.org.in. ➢ Complaints in physical / paper form can be sent to CRPC, Reserve Bank of India, Central Vista, Sector -17, Chandigarh -160 017.

Complaint to Securities and Exchange Board of India (SEBI) ➢ Please visit the link at https://www.sebi.gov.in/

 Complaint to Insurance Regulatory and Development Authority of India (IRDAI) ➢ Please visit the link at https://www.irdai.gov.in/

Complaint to National Housing Bank (NHB) ➢ Please visit the link at https://nhb.org.in/

Complaint to Cyber Police Station ➢ Please visit https://cybercrime.gov.in/ *”

Conclusion

Glossary containing explanations for 28 words adorn pages 34-38.

Some of them like OTP, PW, Wallet, Vishing, UPI, QR Code, Phishing, Point of Sale, National Electronic Fund Transfer (NEFT), Money mule, KYC, Encryption, EMI, CVV, Advance fee/Processing fee/Token fee ETC, are used daily in electronic communication and deserve our memory upgradation.

My observations

As a banker, I have come across frauds, dealt with CBI cases, and got defrauded due to my carelessness. This booklet from RBI, the most authentic, and reliable opens up the modern window for a common man/woman on Frauds, the trillion dollars industry.

Yes, earning money is not sufficient but to retain it as your own is very important. Better to be sceptic than be a cry baby later.

Reference

RBI website

https://rbidocs.rbi.org.in/rdocs/content/pdfs/BEAWARE07032022.pdf

Disclaimer: The contents of this article are for information purposes only and do not constitute an advice or a legal opinion and are personal views of the author. It is based upon relevant law and/or facts available at that point of time and prepared with due accuracy & reliability. Readers are requested to check and refer relevant provisions of statute, latest judicial pronouncements, circulars, clarifications etc. before acting because of the above write up. The possibility of other views on the subject matter cannot be ruled out. By use of the said information, you agree that Author/Tax Guru is not responsible or liable in any manner for the authenticity, accuracy, completeness, errors, or any kind of omissions in `this piece of information for any action taken thereof. This is not any kind of advertisement or solicitation of work by a professional.

Author Bio

Qualification: Post Graduate
Company: subramanian natarajan cpa firm
Location: NEW DELHI, Delhi, India
Member Since: 09 May 2017 | Total Posts: 236
A banker with 27 years of experience, a CPA from USA with specialization in US taxation, individual, partnership, S corporation or LLC taxation etc View Full Profile

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