Adopt SOP against mule accounts in 4 weeks, SC directs states & UTs, Pg9

Key Highlights:

• The Supreme Court has directed all states and Union Territories to formally adopt and circulate a Standard Operating Procedure (SOP) within four weeks to combat 'digital arrest' scams and mule accounts.
• The SOP, proposed by the Reserve Bank of India, mandates temporary debit holds on suspicious accounts to prevent cyber-enabled fraud.
• The bench, comprising CJI Surya Kant, Justice Joymalya Bagchi, and Justice V Mohana, also ordered the operationalization of State Cyber Crime Coordination Centres and the adoption of the e-zero FIR mechanism.
• The Inter-Departmental Committee (IDC) is tasked with issuing advisories, considering a shared liability and victim compensation framework, and examining a lower investigation threshold for the CBI.
• The directive stems from the Supreme Court taking suo motu cognizance in November last year following a 'digital arrest' fraud complaint.
• Over ₹18.05 crore has been restored to victims in 36,290 cases, and complaints on the National Cybercrime Reporting Portal (NCRP) have shown a decline.

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Detailed Insights:

• The SOP aims to streamline the process of freezing suspicious bank accounts, which are often used by fraudsters in 'digital arrest' scams.
• The Inter-Departmental Committee (IDC) had previously agreed with the framework for action by banks, emphasizing a coordinated approach.
• The new directives require the SOP to incorporate a grievance redressal mechanism, a money restoration module, and public awareness measures.
• The e-zero FIR mechanism, to be adopted in consultation with the Indian Cyber Crime Coordination Centre (I4C), allows for filing First Information Reports irrespective of jurisdiction.
• The IDC will coordinate with banks to prevent 'digital arrest' scams, facilitate recovery of defrauded money, and assist investigations.
• The Ministry of Electronics and Information Technology (MeitY), Department of Telecommunications (DoT), and I4C are to examine time-based restrictions on audio and video calls to curb misuse by fraudsters.
• Legal services committees across the country are urged to enhance public awareness regarding cyber-enabled financial frauds.
• The Supreme Court initiated the action after an Ambala couple was defrauded of ₹1.08 crore by scammers using forged orders.

Key Concepts Involved:

• Digital Arrest Scam: Fraudsters impersonate law enforcement or government officials, threatening arrest to extort money, often through video calls and fake documents.
• Mule Account: A bank account used by criminals to receive and transfer illegally obtained money, often belonging to unsuspecting individuals, to obscure the money trail.
• Standard Operating Procedure (SOP): A set of step-by-step instructions detailing how routine tasks or processes should be carried out consistently and correctly within an organization.
• e-zero FIR: An electronic First Information Report that can be registered at any police station, irrespective of jurisdiction, especially for cyber financial crimes, to expedite investigation.
• Indian Cyber Crime Coordination Centre (I4C): An initiative by the Ministry of Home Affairs to combat cybercrime in India in a coordinated and comprehensive manner.
• National Cybercrime Reporting Portal (NCRP): An online platform established under I4C for citizens to report various types of cybercrime complaints, including financial fraud.