If you are stuck in such a situation, here is what to do.

A gentleman named Mr. Sameer Verma found himself in a distressing situation with a digital investment application called ‘Aura Digital Gold’. For nearly two years, he diligently invested through a Systematic Investment Plan (SIP), contributing approximately ₹385 daily. His accumulated savings on the platform grew to a substantial ₹2.1 lakh. However, when he recently attempted to withdraw these funds to his registered bank account, his requests were systematically ignored. The withdrawal process would not complete, and his attempts to contact the company’s customer support were futile. Dozens of calls went unanswered, and messages sent to their official WhatsApp number were met with silence. This lack of communication and inability to access his own money has led Mr. Verma to suspect that the application might be a fraudulent scheme or a failed business that has absconded with investor funds. This scenario is increasingly common in the age of digital finance, and it is crucial to know the legal steps to take to protect your interests and recover your hard-earned money.

Advice in such cases

If you find yourself in a similar predicament, it is essential to act methodically and promptly. Panic can lead to mistakes; a structured approach is your best ally.

• Document Everything: Compile all records related to your investment. This includes screenshots of your account dashboard showing the balance, transaction history, failed withdrawal attempts, and any communication (or attempts at communication) with the company, such as call logs, emails, and WhatsApp messages.
• Gather Transaction Proof: Collect all bank statements showing the daily or periodic debits for the SIP paid to the company. These are crucial pieces of evidence that establish the financial trail.
• Send a Legal Notice: The first formal step is often to have a lawyer send a detailed legal notice to the company at its registered address. This notice will outline your grievance, demand the return of your money within a specified period (e.g., 15 or 30 days), and warn of legal action if the demand is not met.
• **Consult with Lawyer:** The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

Applicable Sections of Law

Several Indian laws can be invoked in such cases to protect your rights and seek redressal. The specific laws applicable will depend on the nature of the entity and the offence.

• Bharatiya Nyaya Sanhita, 2023 (BNS): If the company’s actions amount to fraud or deception, provisions related to cheating can be invoked. For instance, Section 318 of the BNS, which deals with cheating and dishonestly inducing delivery of property, could be relevant. If there is a criminal breach of trust, Section 316 of the BNS may apply.
• Information Technology Act, 2000: Since the fraud is perpetrated through a digital app, this Act is highly relevant. Sections related to computer-related offences, identity theft, and cheating by personation by using computer resources can be applied.
• Consumer Protection Act, 2019: As you are a consumer who has availed a service (the investment platform), you can file a complaint in the appropriate Consumer Disputes Redressal Commission for deficiency in service and unfair trade practices.
• Securities and Exchange Board of India (SEBI) Act, 1992: If the investment app was offering securities or collective investment schemes without proper registration from SEBI, you can file a complaint with SEBI through their SCORES platform.

If you are the complainant

As the person who has been wronged, you are the complainant, and you must initiate the legal process. Here are the steps you should take:

• File a Police Complaint: You should file a written complaint at your local police station or with the Cyber Crime Cell. This complaint should detail the entire sequence of events, from investment to the refusal of withdrawal, and attach all the evidence you have gathered. The police can then register a First Information Report (FIR) under the relevant sections of the BNS and IT Act.
• File a Consumer Complaint: Simultaneously, or as an alternative, you can file a complaint before the District, State, or National Consumer Commission, depending on the value of your claim. This is a quasi-judicial process and is often faster for recovering money.
• Report to Regulatory Bodies: If the app deals with financial products that fall under the purview of regulators like the Reserve Bank of India (RBI) or SEBI, file a formal complaint with them. They have mechanisms to investigate and take action against unregulated or fraudulent entities.
• **Consult with Lawyer:** The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

If you are the victim

Realizing you are a victim of a financial scam can be overwhelming. It is important to remember that you are not alone and that the law provides remedies.

• Act Immediately: Time is of the essence. The sooner you report the matter, the higher the chances of tracing the digital trail and potentially freezing the accounts of the fraudulent company.
• Preserve All Evidence: Do not delete any messages, emails, or the app itself from your phone. Take screenshots of everything, as digital evidence can be volatile.
• Follow Professional Advice: Navigating the legal system can be complex. Rely on the guidance of your lawyer to ensure you are taking the correct steps in the right order.
• **Consult with Lawyer:** The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

How the police behave in such cases

Initially, a local police station might show some reluctance if they are not well-versed in cybercrime. However, it is your right to have an FIR registered for a cognizable offence. In most urban areas, dedicated Cyber Crime police stations are equipped to handle such cases. Once an FIR is registered, the police will typically:

• Initiate an Investigation: An Investigating Officer (IO) will be assigned to your case.
• Trace the Digital Footprint: The cyber cell will work to trace the IP addresses, server locations, and bank accounts linked to the fraudulent app.
• Issue Notices: The police will issue notices to banks, payment gateways, and domain registrars to gather information and freeze the accounts associated with the accused company.
• Gather Evidence: They will collect evidence, record statements, and try to identify the individuals behind the company. The process can be slow, especially if the perpetrators are operating from different states or countries.

FAQs people normally have

• Can I get my money back?
  Recovery of money is possible but not guaranteed. It depends on whether the police can successfully trace and freeze the company’s accounts before the funds are siphoned off. Civil remedies, like a consumer court order, can also lead to recovery if the company has traceable assets.
• Should I file a police complaint or a consumer complaint first?
  You can pursue both simultaneously. A police complaint addresses the criminal aspect (fraud, cheating), while a consumer complaint addresses the civil aspect (deficiency in service, recovery of money). An experienced lawyer can advise on the best strategy for your specific case.
• How do I check if an investment app is legitimate?
  Before investing, check if the company is registered with the Ministry of Corporate Affairs (MCA). If it offers financial products, verify its registration with regulatory bodies like SEBI (for securities) or RBI (for NBFCs). Look for genuine reviews, a physical office address, and transparent contact information. Be wary of apps that promise unusually high returns.

What evidence is required?

To build a strong case, you will need comprehensive evidence. The more detailed your documentation, the better.

• Screenshots of the app interface showing your investment portfolio, account balance, and personal details.
• Complete transaction history from within the app.
• Screenshots of all failed withdrawal attempts, including dates and times.
• Bank account statements clearly showing all payments made to the app/company.
• Any emails, SMS, or WhatsApp messages exchanged with the company.
• The company’s details, such as its name, website, and any available address or contact information.
• A copy of the legal notice sent to the company and the postal receipt.

How long will the investigation take?

The duration of an investigation can vary significantly. A criminal investigation into a cyber-financial fraud can take several months to years. These cases are complex as they involve tracing digital and financial trails across multiple platforms and jurisdictions. The police need to obtain data from banks, payment gateways, and tech companies, which can be a time-consuming process. A consumer case is generally faster and may be resolved within a year, but this can also vary based on the workload of the commission and the complexity of the case.

Advocate Sudhir Rao, Supreme Court of India