The Intelligence Fusion and Strategic Operations (IFSO) Unit of Delhi Police's Special Cell has busted various modules of instant loan applications having Chinese connection, and arrested 22 people in the last two months for allegedly siphoning off Rs 500 crore to China by the hawala route or by investing in cryptocurrency, an official said on Saturday.
The arrested individuals were working on behest of Chinese nationals. Deputy Commissioner of Police KPS Malhotra said that hundreds of complaints were received by Delhi Police that instant loan applications are disbursing loans at higher rates and even after payment of loan, they are extorting money using the morphed nude pictures.
"The IFSO took cognizance of the same and started analysing the complaints during which it was found that more than 100 such apps are involved in the loan and extortion racket," Malhotra said.
The police carried out extensive technical analysis after which it was learnt that all the apps were seeking "malicious permissions" from the user.
After obtaining the access permissions, the contacts, chats, messages and images of the user were being uploaded to the servers based in China and Hong Kong. The analysis of the money route also revealed that the money was being routed to China through hawala and crypto-currencies.
"Applications were developed in the garb of loan providing apps. These applications were malicious in nature and seek all permissions from the user. Applications were hosted on Google Play and websites. Users in need of loan downloaded the applications by granting all the permission. Soon after this, the application started uploading the contact lists, chats, images of the user to the servers hosted in China and other parts," the police officer said.
This data was also sold to different private firms.
The customers were receiving calls from different numbers (procured on fake IDs) forcing them to pay more and more by threatening them using the morphed pictures. Due to fear and stigma, the users began paying them money in different bank accounts opened against fake IDs.
The money collected was diverted to specific bank accounts and then sent to China through Hawala or after purchasing cryptocurrencies.
"People who were in dire need of a small loan ranging from Rs 5,000 to 10,000 is being forced to pay even in lakhs," the official claimed.
The financial trial revealed that multiple accounts are being used for getting the amount. In each of the account, transactions of more than Rs 1 crore was being credited daily.
Identities of few Chinese nationals have been confirmed and efforts are being made to trace and arrest them.
"From the analysis of the financial trail and other technical analysis, it was also revealed that Chinese nationals are actively involved in these loan applications scams. Further, after police crackdown, they are shifting their recovery call centres to Pakistan, Nepal and Bangladesh," the police said.
Delhi Police has identified mobile apps through which Rs 500 crore was sent to China via Hawala or by buying Crypto-currency.
Malhotra said that there are more than 100 apps involved in such big extortion racket through mobile loan apps.
These are the apps which used to give small loans. Their actual owners are said to be Chinese nationals.
"Lynda, Akira, Zoya, Kobe Bryant and Luo Rong a.k.a. Xiasi, are the Chinese nationals involved in the matter who were owner of a few apps," said Malhotra, adding three separate cases were lodged in this regard.
Name of the apps which have been identified by police are -- Raise cash app, PP money app, Rupees master app, Cash ray app, Mobipocket app, Papa money app, Infinity cash app, Kredit mango app, Kredit marvel app, CB loan app, Cash advance app, HDB loan app, Cash tree app, Raw loan app, Under Process, Minute cash app, Cash light app, Cash fish app, HD credit app, Ruppes land app, Cash room app, Rupee loan app and Well Kredit app.
Scores of chartered accountants, company secretaries and cost accountants are also currently under the regulatory scanner for alleged violations of the companies law with respect to setting up of certain Chinese companies and their subsidiaries in India, according to officials.
The apex bodies of chartered accountants and company secretaries, ICAI and ICSI, have together received around 400 complaints on the issue and necessary actions have been initiated. The Institute of Cost Accountants of India has also initiated action against some of their members in the matter.
The government is looking at whether the Chinese companies and their subsidiaries have complied with all the regulations to come and do business in India, ICAI President Debashis Mitra said.
Show cause notices have been issued to the members concerned by the Institute of Chartered Accountants of India (ICAI) and the Institute of Company Secretaries of India (ICSI), respectively. The Institute of Cost Accountants of India has also issued show cause notices to some of its members.
After ascertaining whether the members violated the companies law, appropriate disciplinary actions would be taken against them, the officials said.
The members have been asked to explain about the alleged violations of companies law with respect to incorporation of various Chinese companies and their subsidiaries.
"The ministry had asked the institute to start disciplinary proceedings. It is not much to do with audit. It is more to do with formation of the companies concerned and aspects such as whether the registered addresses were checked properly or not, those kind of things," ICAI President Debashis Mitra told PTI.
The institute has received details for about 200 cases.