In a significant move to combat the rising menace of cyber fraud, the Supreme Court of India has directed the Central Bureau of Investigation (CBI) to conduct a pan-India investigation into cases of 'digital arrest' scams. This order holds particular weight as it effectively bypasses the withdrawal of "general consent" for CBI probes by several opposition-ruled states.
CBI Gets Free Hand to Probe Scams and Bankers
The bench, comprising Chief Justice of India D.Y. Chandrachud and Justice J.B. Pardiwala, highlighted the severe threat posed by digital fraudsters. While keeping investment and part-time job scams under consideration for future monitoring, the court immediately tasked the CBI with investigating the digital arrest racket. The bench emphasized that the CBI shall have a free hand to investigate bankers under the Prevention of Corruption Act when they are suspected of facilitating fraudsters by opening 'mule accounts' used to park illicit funds.
Suspecting insider assistance within the banking system, the court underscored the need for a thorough probe. It also noted the transnational nature of these crimes, with many operations running from overseas 'scam hubs'. Consequently, the bench directed the CBI to coordinate with Interpol to target these international cybercrime havens effectively.
Court Seeks Action on SIM Misuse and AI Monitoring
The Supreme Court expressed grave concern over the negligent issuance of SIM cards, which facilitates such scams. It stated that facts on record reveal an alarming and irresponsible approach by telecom service providers in issuing multiple SIMs under one name. The court has directed the Department of Telecommunications (DoT) to submit a proposal to the Supreme Court to prevent this misuse.
Furthermore, the court issued a notice to the Reserve Bank of India (RBI), asking it to explain why artificial intelligence and machine-learning tools should not be deployed to identify and freeze suspicious 'mule accounts' holding proceeds of crime. IT intermediaries have been ordered to preserve data related to devices used by fraudsters and provide full assistance to the CBI.
Nationwide Coordination for Cyber Crime Fight
To ensure a cohesive national response, the Supreme Court has directed all states and Union Territories to establish and operationalize their regional or state Cyber-Crime Coordination Centres. These centres must coordinate closely with the Ministry of Home Affairs' Indian Cyber Crime Coordination Centre (I4C).
The court has also asked the MHA, the Ministry of Finance, the DoT, and the Ministry of Electronics and Information Technology (MeitY) to submit a detailed action plan for coordinated steps against digital arrest scams. To allow the CBI to assemble a specialized team, the hearing has been adjourned for two weeks. The agency is to select experienced officers from state police forces and IT experts to assist in the nationwide investigation.
