(The writer is Director, Char Areas Development, Assam. He can be reached at mahmoodhassan61786@gmail.com)
With the growing popularity of the digital medium, financial transactions have grown by leaps and bounds with the introduction of the core banking system. The use of the digital media for online transfer of funds has been recognised by the governments for bringing transparency thereby eradicating the middlemen in DBT (direct benefit transfer) payments to beneficiaries for any public sector schemes. This has indeed helped in reduction in corruption in monetary transactions. But how safe are our bank accounts after introduction of core banking system despite all these developments? The idea of a "Digital India" might have a superlative positive impact in our everyday lives, but the big question is how safe is this medium? The darker side of technology has revealed large-scale forgery of records by criminals to access to bank accounts for siphoning off hard earned money by fraudulent means. Most of the rural and poor beneficiaries are caught unaware to whom the fund is transferred through DBT to their bank accounts are siphoned off. The number of cybercrime is gradually increasing in the society as more and more unemployed youths are resorting to such crimes for the sake of earning a few extra bucks.
With the promotion of digital platform most of the people are using the digital mode of payment. People are turning to Unified Payment Interface (UPI) apps for making various payments. In many cases fraudsters are taking advantage of the various loopholes in the portals and easily gain access to the personal accounts of the customers. The police and the cyber security experts are facing new challenges as criminals are resorting to various methods to dupe the public posing as bank officials to have access to the accounts. Unfortunately, the cyber security norms are neither foolproof nor safe enough to prevent the growing rate of cybercrime, particularly issues relating to monetary transactions. According to the National Crime Records Bureau (NRCB), the cybercrimes are increasing every year. In 2104 there were 9622 cases that rose to 12,317 in 2016. In 2019 there were 44546 cases reported compared to 28248 in 2018. Cybercrimes in India have caused a loss of more than Rs 1.25 lakh crore in 2019 alone. Among the cases reported from the states like Karnataka has topped the list whereas Assam is in fifth position.
Recently Netflix featured a series named Jamtara based on a true story of a village where most of the youths are involved in banking frauds making phone calls all across the country posing as bank officials duping the customers. The criminals collect mobile phone SIM cards, digital wallets and bank accounts on the back of fake KYC documents. Jamtara located in Jharkhand has now earned the dubious distinction of being the cybercrime capital of India. Till date SIT of 23 states visited this small hamlet to conduct investigation in those states through these youths committing bank fraud. Till date185 criminals has been arrested by police so far. In raid in 2017 they collected 700 mobiles, 900 SIM cards, 160 ATM cards, 10 four wheelers, 90 two-wheelers and Rs 17 lakhs in cash. Similar incidents are now on the rise all over India.
One of the most serious issues is the growing fraud in online scholarship scheme for poor students belonging to the minority community. Recently Indian Express daily team made an on-field investigation in Jharkhand and Bihar where reporters have found large-scale fraud and misappropriation of funds of the students by cyber criminals. The Minority Scholarship schemeis run by the Ministry of Minority Affairs, Government of India. Online applications are invited by the Ministry of Minority Affairs of Government of India for the three scholarship programmes namely Pre-Matric, Post-Matric and Merit-cum-Means. The students' applications are uploaded online in the National Scholarship Portal of the Ministry. Then these applications are verified by the Head of the Institutions. In many cases the computer illiterate teachers take help of cyber cafe owners or CSP operators of banks located in the remote areas where the reach of bank is inaccessible. In the process the teachers share the secret Password and user id provided by the District Education authorities. By misusing the password these cyber criminals make fake entries of students, open fake accounts in the banks and obtain fake SIMs with mobile numbers to obtain the OTPs from the banks. Unfortunately the district-level authorities responsible for second-level verification do not verify the records properly. The digital files are created in the Ministry from where fund are transferred to these fake accounts through DBT. Thus they siphon off the fund meant for the poor students without the knowledge of the students and guardians.
In Assam, also similar incidents have been reported from the minority-dominated districts of the State. A large number of teachers collided with the CSP operators and middlemen to open fake accounts of fake students and siphon off the money in the accounts. After the Director of the Assam Minorities Development Board filed an FIR all cans of worms were spilled out as till date more than 30 persons have been arrested for misappropriation of funds. Unless the technical loopholes in the portal are plugged criminals will continue to take advantage of such weaknesses in the system.
Development Economist John Dreze states that this scam is another example of the vulnerabilities of a payment system where poor people are regularly robbed of their wages, pensions and scholarships by corrupt CSP operators and Business correspondents who take the bio-matric fingerprints on one pretext or another. Criminals usually make fake calls to the customers to inform that their ATM card has been blocked and for renewal they needs to share their ATM card detail which leads to fraud. They ask for the 16-digit card number and its details .While on call one of them feed this information in an e wallet, including the CVV number, an expiry date on the card.Then they tell the victim to share the OTP message they would be receiving from bank which is essential for the criminal to transfer money from the victim's account to an e wallet such as paytm or Oxigen.This e wallet is already linked with a bank account opened only for this purpose. India has over 1.5 billion savings and bank accounts and some 20 million credit cards and 820 million debit cards.
The common people are still computer illiterate and unscrupulous people take advantage of their ignorance. Cyber vigilance cells have to be set up wherever DBT is done by following process of the Public Fund Management System (P-FMS). Otherwise in future such fraudsters will cripple all the financial institutions. There is an urgent need to train all the investigating officers in cyber and digital forensics and open cyber police stations not only in the urban but rural areas as well. The opening of such a cybercrime police station at Jamtara led to the revelation of such a large-scale scam in Jharkhand. At a time when the country is planning to develop Smart cities, rolling out 5G, developing Internet-of-Things (IoT) and Artificial Intelligence network among other initiatives the cyber security network has to be strengthened. On 15th August this year Prime Minster Narendra Modi announced that a new cyber security strategy will be presented to the nation as dependence on cyber space will increase by multiple fold in the coming years. It is high-time to implement the strategy in view of growing number of cybercrimes in the country.