E-Paper
Digital arrest fraud: SC expresses concern on how educated seniors are falling prey
The observations came while issuing notice on a petition filed by 78-year-old former banker, who fell victim in September last year and lost more than ₹23 crore, the largest such case reported so far.
The Supreme Court on Friday voiced concern over the growing instances of “digital arrest” fraud, observing how even educated and experienced senior citizens were being misled into complying with the demands of such fraudsters.
“We are shocked at how people are behaving. When this kind of call comes, you are simply accepting their dictation. Generally, with age, you learn so much and you gain experience also,” a bench of Chief Justice of India (CJI) Surya Kant and justice Joymalya Bagchi said.
The observations came while issuing notice on a petition filed by 78-year-old former banker Naresh Malhotra, who fell victim to a “digital arrest” fraud in September last year and lost more than ₹23 crore, the largest such case reported so far.
HT reported it first in September, followed by Malhotra’s detailed interview sharing his ordeal.
The petition sought directions to banks to frame safeguards against such scams, including alerts in cases of suspicious high-value transactions, among other reliefs. These issues are already under consideration in a suo motu case pending before the apex court. After perusing the facts, the bench remarked, “We feel so disappointed how a person can lose their sense on getting such calls.”
The court, however, tagged Malhotra’s plea with the ongoing suo motu proceedings being heard by a bench led by the Chief Justice of India. While initiating the suo motu case, the court had taken note of a letter from a senior citizen couple who were allegedly defrauded of over ₹1 crore by imposters posing as enforcement officials. The court had observed that retired senior citizens are increasingly being targeted and stripped of their lifetime savings.
In the suo motu matter, the Supreme Court has already transferred all similar digital fraud cases to the Central Bureau of Investigation (CBI). The Centre has also constituted a high-powered committee to strengthen coordination among police, banks, telecom operators and social media platforms to prevent such frauds.
Senior advocate K Parmeshwar, assisted by advocate Nupur Sharma, appeared for Malhotra and told the court that the petitioner is a widower and was recovering from knee surgery at the time of the incident, with his children settled abroad. Parmeshwar argued that banks owe a duty of care to account holders and said the petitioner would pursue compensation-related remedies before the National Consumer Disputes Redressal Commission (NCDRC).
The court noted that it has already asked the CBI to examine possible involvement of bank officials, but questioned how such large sums could be transferred. Parmeshwar countered that the fraud was highly planned, with the perpetrators contacting Malhotra on his landline and possessing detailed personal information.
According to the petition, the fraud began on August 1 last year, when Malhotra received a call and was later shown a purported Mumbai Police arrest order on WhatsApp. Impersonating Mumbai Police and Enforcement Directorate officials, the fraudsters accused him of links to terror financing and induced him to liquidate assets and transfer nearly ₹23 crore to 16 bank accounts he believed belonged to the Reserve Bank of India.
