Digital Arrest Scam

The Supreme Court has ordered the Central Bureau of Investigation (CBI) to conduct a pan-India probe into rising ‘digital arrest’ scams.

Key Directions Issued by the Supreme Court

• Free Hand to Investigate:
  • The Court authorised the CBI to launch a comprehensive probe, giving the agency freedom to examine mule account networks and banking-linked corruption.
  • Exceptional Circumstance: The Court acknowledged that directing the CBI without state consent is an extraordinary step, done only when compelling circumstances exist.
  • Stage-Wise Investigation: Priority to be given to digital arrest, followed by investment scams, then job scams.
• State Government Consent:
• • 13 States including Bihar, Tamil Nadu, Karnataka, Kerala, among others have been directed to accord consent under Section 6 of the Delhi Special Police Establishment Act to investigate ‘digital arrest’ cases under the Information Technology Act, 2000 in their jurisdictions. 
  • Multi-State & Technical Teams: CBI must identify state police officers and cyber specialists to aid investigation.
• International Cooperation: Given the global footprint of scammers, the Court instructed the CBI to collaborate with Interpol to identify foreign cybercrime hubs.
• Role of RBI: The Reserve Bank of India has been asked to explain the use of AI/ML technologies to detect layering (movement of scam money across bank accounts).
• Online Intermediaries: Under the IT (Intermediary Guidelines & Digital Media Ethics Code) Rules 2021, digital platforms must cooperate with the CBI and share required data.
• Strengthening National Cyber Architecture: All States and UTs must establish regional cybercrime coordination centres, linked with the Indian Cybercrime Coordination Centre (I4C).
• Telecom Sector Accountability
  • Negligence in SIM Issuance: The Court criticised the “alarming and irresponsible” issuance of multiple SIM cards in the same name by telecom operators.
  • Telecom Department Action: The Department of Telecommunications must submit a proposal for stricter SIM-verification measures, to be enforced by all telecom service providers.

What is a Digital Arrest Scam?

• Definition: A digital arrest scam is a cyber-extortion scheme in which fraudsters impersonate law-enforcement officers and falsely accuse victims of crimes to extort money.
• Psychological Coercion: Scammers intimidate victims by claiming involvement in illegal activities (financial fraud, tax evasion, parcel seizure) and use fear of arrest to force payments.

How the Scam Operates

• Impersonation of Officials: Criminals pose as CBI, police, Income Tax, Customs or RBI officials and initiate contact through calls or emails.
• Switch to Video Calls: Victims are pushed to WhatsApp or Skype video calls, where scammers create a fake police-station backdrop to appear authentic.
• Fake Digital Warrant: Fraudsters issue a fabricated “digital arrest warrant” and force victims to stay online for hours, mimicking custody.
• Threat of Legal Action: Accusations such as money laundering, tax violation or cybercrime are used to create panic and urgency.
• Forced Payments: Victims are told to “clear their name” by transferring money into designated accounts, “escrow wallets” or “verification deposits.”
• Disappearance Post-Payment: Once funds are transferred, scammers go offline, leading to financial loss and potential identity misuse

Need for Action

• Magnitude of Scam: A government note informed the Supreme Court that over ₹3,000 crore has been stolen by scammers.
• Senior Citizen Vulnerability: Elderly individuals are frequently targeted due to fear and unfamiliarity with digital crime patterns.
• CERT-In Advisory: CERT-In has flagged digital arrest as an emerging high-risk cyber threat, alongside deepfake fraud and investment scams.
• Rising cases prompted the Supreme Court to direct national-level action and improved coordination.

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