Delhi Police Cyber Cell has arrested five people from Delhi, Haryana and Uttar Pradesh for allegedly abusing and blackmailing borrowers of a loan application, police said in a press release. The blackmailed amount was sent to China, the statement added.
The app is called Cash Advance Ha, which police described as “an unauthorized Chinese microfinance company.” To install this application available online, you must be granted access to the collection and contact list on your device. Once the user was granted access, “all his data was automatically transferred to Chinese servers” and the loan amount was disbursed.
The team that participated in the functions of the application monitored the users who received the loan payment.
“After a day of loan transfer, the group of defendants started calling the loan applicants and their known relatives, friends, etc. via different WhatsApp / mobile phone numbers to pay off the loan… Even after repaying the loan / money, the alleged defendant used to extort more money from the loan applicant and also started distributing vulgar / threatening messages to the family member, the relatives and friends of the loan applicant to force him to pay more and more money “. – Delhi Police Press Release
In the past several people ended their lives due to harassment from representatives of predatory lending applications, some of whom were found to have links to Chinese nationals.
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They called victims from fraudulent numbers
On March 15, Anurag Halder (a resident of Sodepur, Calcutta) filed a complaint alleging that his family, friends and himself had been abused and threatened by strangers via WhatsApp calls from international mobile phone numbers. This was done after getting a loan from the Cash Advance Ha application.
Based on the complaint, Delhi police analyzed the phone call records of the phones allegedly used to commit the crime. “It simply came to our notice then making calls to victims through a fraudulently acquired WhatsApp number and their registered owners were unaware of this WhatsApp activation from their mobile numbers. Most of these cell phone users were from West Bengal and Assam“, Said the Delhi police.
Call records also revealed that one of the suspects was located in the Delhi-Gurugram border area. Based on this information, the police raided Salapur Khera, Bijwasahan in Delhi, where they arrested 22-year-old Sonu Singh. Following the interrogation of Singh, who allegedly worked as a recovery agent for the company, police also arrested Vikash Kumar from Farukhabad, Uttar Pradesh.
“During the technical analysis, it was further established that Vikash Kumar was managing a group of callers, who used to call the loan applicants / victims who had received a loan from their application. “During the analysis of the gadgets of the accused, it was found that the accused were sending threatening messages to the contact list of the victims in order to blackmail the victims”, the press release states.
During a technical analysis of the application, Delhi Police found that the loans could be easily obtained from the application without verifying the KYC documents. “The loans were disbursed in a very short period of time, sometimes immediately to specific UPI accounts or bank accounts with a higher interest rate. A small loan amount could be disbursed after the cut in service fees at higher interest rates, such as if Rs.6000 / – is the loan amount, Rs. 2300 / – would be service charge and Rs. “3700 / – would be a loan disbursement amount”, he stated.
Delhi police analyzed the malware application and found that the data had been sent by the application to third-party servers based in China. The extorted money was also sent to China in the form of a cryptocurrency by a defendant in the case.
Hyderabad police stopped a similar operation last month
The Hyderabad City Police Cybercrime Directorate arrested two Bangalore residents allegedly handling six instant loan applications under the supervision of a Chinese national named Chen Chaoping.
Shabbir Alam and Umakanth Yadav were employees of Koramangala-based Sky Links Technology Pvt Ltd, a company that allegedly managed the loan applications – Ocean Ruppee, Life Wallet, Maloo Wallet, Elephant Cash, Box Cash and Dutta Rupee. Once installed, the applications gained access to the collection, contact list, and location stored on the device prior to short-term lending, according to a press release.
In 2020, Chaoping reportedly operated a loan application call center called Golden Bag Technologies Pvt. Ltd in Bangalore. Alam worked as a supervisor and Yadav was the IT Director of the company. However, when police began cracking down on robbery applications in 2020, Chaoping fled to China.
“After 2 months, the Chinese national contacted the accused Shabbir Alam and Umakanth Yadav again and instructed them to operate the call center by presenting new loan applications.” The applications were reportedly developed by Chaoping. Based on his instructions, the accused hired about 100 answering machines and founded Sky Links Technology Pvt Ltd.
How Bad Is The Problem Of Predatory Lending In India?
SaveThem India, an institution working to address the problem of lending applications in India, received more than 55,000 calls from harassment victims from lending application agents as of last September. Here are the common harassment techniques used by these agents to recover money:
- Late night calls: Lending applications use automated calling software to harass victims late at night and interfere with their daily lives.
- Threats to update contacts: In case of default of the borrower, the lending agents threaten to call the borrower’s contacts or create WhatsApp groups to announce that they are not paying. In some of the screenshots accessed by MediaNama, such groups were created and “420” or “scam” images written over the victims’ photos were released.
- False legal notices: Application managers are threatening to take legal action against borrowers and send fake legal notices with electronic stamps indicating the stamp duty paid on the basis of the registered case to the government.
They are not just dark applications
At a time when Chinese lending applications are being criticized for imposing exorbitant interest rates and using robbery practices, fintech MobiKwik has been accused of resorting to similar, ethically dubious practices to secure the repayment of a loan that benefited from its platform.
The incident is related to Bharath C Raghurama, a 34-year-old local from Karnataka, who is currently based in Gujarat. Raghurama had taken advantage of an instant loan offered by MobiKwik in December and his repayment was scheduled for the end of the month. But when Raghurama was unable to pay it on time, he claimed that MobiKwik agents began harassing him via WhatsApp. He was warned that if he is not able to return the amount as soon as possible, then his friends and family will be informed of the situation. They also added a list of his “key contacts” as proof that they have access to the data of his friends and family.
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