Digital fraud of Rs 54,000 crore

People across the country have lost Rs 54,000 crore to cyber fraud between April 2021 and November 2025. Fraudsters operating from unknown locations cheated victims through phone calls, digital methods and so-called “virtual arrest” scams, without doing any real work. The Supreme Court described this large-scale fraud as nothing less than organised looting. The court also said banks can play a key role in preventing such crimes. It also directed the Centre to consult the Reserve Bank of India (RBI) and others to frame clear guidelines to stop digital fraud.

The court raised serious concerns about whether some bank officials are helping fraudsters open accounts and carry out transactions. It warned that such doubts could weaken public trust in the banking system. While hearing a case taken up on its own, the court said there must be coordinated action involving the CBI, RBI and the IT Ministry to tackle digital fraud. The Supreme Court also suggested that banks should introduce a system to alert account holders when unusually large transactions take place. This alone could prevent many major frauds.

The court pointed out that fraudsters also take advantage of the lack of awareness among local police. For example, it is normal for a pensioner to withdraw Rs 10,000 or Rs 20,000. But if a huge amount like Rs 50 lakh or Rs 70 lakh is suddenly withdrawn from the same account, banks should immediately alert the account holder. The court said artificial intelligence (AI) technology should be used for this purpose. In its status report, the government informed the court that the Home Ministry has formed a committee to examine all issues related to digital arrest scams and to address institutional weaknesses. The report also mentioned that a case in Delhi, where a 76-year-old widow was cheated of Rs 1.64 crore, has been handed over to the CBI for investigation.

The report said that breaking the main networks of these frauds, which operate both within India and abroad, would require not only the CBI but also support from Interpol. The Union Home Ministry is also considering setting up a separate national agency dedicated only to investigating cyber fraud. As digital transactions are expected to increase in the future, fraudsters are likely to use new methods and technologies. A specially trained police unit would be better equipped to track such crimes. Since many frauds are operated from other states, state police face limitations in their investigations. Therefore, setting up a national-level agency may be the best solution.