Context: 

According to a Parliamentary panel report, cyber frauds reported on the National Cybercrime Reporting Portal have more than doubled in the current financial year till September 2023. 

• Cyber frauds incur a significant loss in both volume and value but its recovery rate is very low.
  • For Example: The recovery rate has been about 10.4 percent of the transactions reported over the last three years – 2020, 2021 and 2022. 

Cyber Frauds

• Cyber frauds are criminal activities which are done on the internet or using digital tools to trick people, businesses, or even governments to make money.
• These crimes aim to acquire sensitive information of the business, people, and government. 

Methods Of Cyber Frauds

• Hacking: Getting into computer systems to get secret information.
• Phishing: Tricking people with fake emails, messages, or websites to steal their personal details.
• Malware: Installment of software to steal information or take control. 
• Identity Theft: Using someone’s personal info to do fraud.
• Social Engineering: Tricking people by gaining their trust to get information from them.

Status of Cyber Crime In India

• The cybercrime rate in India for 2023 was 129 per lakh population, with Delhi leading at 755, followed by Haryana (381), and Telangana (261).
  • Local-origin frauds include customer care, refund-based, and KYC expiry frauds (35%), sextortion (24%), online booking frauds (22%), AePS frauds, and biometric cloning (11%), and Android malware (8%).
  • International-origin frauds consist of investment and task-based scams (38%), illegal loan apps (23%), gaming frauds, and crypto scams (21%), romance scams (11%), and ransomware attacks (7%).

Reasons for Rise In Cyber Frauds

• The primary causes of cyber fraud include rising internet usage, the surge in digitalization and e-commerce, insufficient awareness and education on cybersecurity, and inadequate cybersecurity infrastructure.

Measures To Check Cyber Frauds

• The National Cyber Security Policy 2023: It aims to strengthen India’s cybersecurity and combat cybercrime effectively.
• CERT-In: It coordinates cybersecurity efforts and issues alerts about threats.
• Two-factor authentication: Banks and other financial institutions are implementing two-factor authentication (2FA) for online transactions to enhance security by adding an additional layer of protection.
• Apart from the above steps, the government has taken various measures such as Cyber Surakshit Bharat Initiative, Cyber Swachhta Kendra, Indian Cyber Crime Coordination Centre (I4C), National Critical Information Infrastructure Protection Centre (NCIIPC), Information Technology Act, 2000 to combat cyber frauds in India. 

Recommendations of Parliamentary Panel Report

• Adoption of multi-pronged approach: The Committee called upon the various ministries involved to focus on preventive measures to ensure that cyber frauds are held under check.
• Empowering India’s Fintech Future: There should be focus on promotion of local Indian players such as BHIM UPI in the fintech universe, as the use of fintech apps is slated to increase for digital financial transactions.

News Source: Thehindubusinessline