If you are stuck in such a situation, here is what to do.
A common and unfortunate scenario has recently come to light involving a retired gentleman, Mr. Sharma, from the city of Alipur. He was enticed into investing a significant sum, over ₹15 lakhs, into a company named “GlobalTrade Ventures” which also operated under the name “ApexFX.” The investment was made in several transactions between August and November of 2023, with all payments meticulously done through bank transfers.
The company, through its local agent Mr. Kumar, promised guaranteed monthly returns of 5-10%, generated by a sophisticated AI trading bot. To build trust, Mr. Kumar presented a series of seemingly official documents, including an apostilled “brokerage license” from the Marshall Islands, a “certificate of good standing,” and a “certificate of incumbency” that listed an Indian director. They also falsely claimed to have a banking license from the Reserve Bank of India (RBI) under a subsidiary called “Innovate Fin India” and used references to financial review websites to appear legitimate.
However, subsequent checks revealed the truth. The RBI had no record of any such license, the financial review sites actually flagged the company as unregulated, and the international documents held no legal weight in India for such deposit-taking activities. The promised returns never materialized, and the substantial investment is now at risk. The agent, Mr. Kumar, continues to answer calls, offering verbal assurances that he will personally repay the money within a year, a classic stalling tactic often used in such fraudulent schemes.
Advice in such cases
Cease All Contact and Payments: Stop all further communication and refuse any requests for additional funds, which are often disguised as taxes or withdrawal fees to extract more money.
Gather All Evidence: Compile every piece of evidence you have. This includes bank statements showing the transfers, screenshots of conversations (WhatsApp, SMS, emails), all documents provided by the company (even if fake), and any recorded phone calls.
File an Online Complaint: The first immediate step should be to file a complaint on the National Cyber Crime Reporting Portal (www.cybercrime.gov.in) or by calling the helpline 1930. This can help in quickly tracing and freezing the bank accounts where the funds were transferred.
Lodge a Formal FIR: Concurrently, file a First Information Report (FIR) at your local police station. For high-value financial fraud, it is often advisable to approach the Economic Offences Wing (EOW) or the Cyber Crime Cell of your city, as they have specialized expertise.
Caution with Agent’s Promises: Do not rely on the agent’s verbal promises of repayment. While you can ask them to sign a promissory note or issue a post-dated cheque, be aware that this can sometimes divert the case from a criminal fraud investigation to a civil recovery matter. This strategy should only be pursued after legal consultation.
Consult with Lawyer: 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
Such fraudulent investment schemes attract penalties under several Indian laws. The new criminal laws are now in effect, and the following provisions may apply:
Bharatiya Nyaya Sanhita, 2023 (BNS): Section 318 (Cheating), Section 316 (Criminal Breach of Trust), and Sections 335 & 336 for forgery of documents.
Information Technology Act, 2000: Section 66D for cheating by personation using a computer resource is highly relevant for online scams.
Banning of Unregulated Deposit Schemes Act, 2019 (BUDS Act): This Act makes it illegal to promote, operate, or accept deposits in such unregulated schemes. This is a powerful tool to prosecute both the company and its agents.
If you are the complainant
If you are assisting a family member who has been victimized, your role is crucial in driving the legal process forward.
Be Proactive: Your family member may be in a state of shock or denial. Take the lead in organizing documents, drafting the complaint, and following up with authorities.
Draft a Detailed Complaint: Your complaint should be a clear, chronological account of events. Mention the initial contact, the promises made, the amounts transferred with dates and transaction details, the documents shown, and the subsequent refusal to return the funds.
Follow Up Relentlessly: After filing the FIR, consistent follow-up with the investigating officer is key. Police stations are often overburdened, and your persistence ensures the case remains a priority.
Consult with Lawyer: 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
If you are the one who has lost money, it is important to act without feeling ashamed or embarrassed. Scammers are professionals who are skilled at deception.
Act Immediately: The sooner you report the crime, the higher the chances of freezing the accounts and potentially recovering some funds.
Cooperate Fully: Provide the police and your lawyer with all the information you have, no matter how minor it seems. Your complete and honest account is your strongest weapon.
Target the Indian Agents: Even if the main company is based offshore, their agents, employees, and directors operating in India can be held legally accountable. The legal action should be directed against these individuals who facilitated the fraud locally.
Consult with Lawyer: 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 be hesitant to file an FIR for a complex online financial fraud, sometimes misclassifying it as a civil dispute. However, with a well-drafted complaint citing the relevant criminal sections, they are obligated to register the case. The Cyber Crime Cell or EOW are generally better equipped to handle such investigations. The process involves tracing the money trail through multiple bank accounts, which can be time-consuming. An experienced lawyer can help ensure the police investigation proceeds efficiently and in the right direction.
FAQs people normally have
What evidence is required?
The most crucial pieces of evidence are the digital and financial trails. This includes:
Bank account statements showing the debits to the scammer’s accounts.
All communication records with the agents (WhatsApp chats, emails, call recordings).
Copies of all the fake licenses, certificates, and agreements provided by the company.
Any promotional material, website links, or advertisements that induced the investment.
How long will the investigation take?
Investigations into financial fraud are complex and can be lengthy. Tracing money that has been moved through multiple accounts (mule accounts) across different states takes time. The legal process, from investigation to chargesheet to trial, can take several years. However, prompt action can lead to the freezing of accounts and the arrest of local agents relatively quickly, which puts immense pressure on the perpetrators and increases the chances of a settlement or recovery.
Advocate Sudhir Rao, Supreme Court of India