Online fraud busted

What can be done to avoid such frauds?

On 2nd Feb 2017, Uttar Pradesh police busted online fraud of US $544 million (Rs 3,700 crore). The UP police have arrested three persons; Mittal, Prasad and Dayal, alleged to have duped nearly 6.5 lakh people through an online portal, 'socialtrade.biz ‘. The company was registered under the name Ablaze Info Solutions Pvt Ltd. in Noida. The investigation also led to the seizure of US $76 million (Rs 520 crore) deposited in 12 accounts of the company with Canara Bank, Kotak Mahindra Bank, Yes Bank and Axis Bank.

How did ‘SocialTrade’ dupe people?

‘Social Trade’ asked victims to subscribe by depositing sums in the range of US $85 (Rs 5,750) to US $850 (Rs 57,500). After becoming subscribers, they would receive URLs (25 to 125 URLs based on the subscription plan) on their phones, every day. Victims were expected to partake in promotion of these URLs and earn US $ 0.07 (Rs 5) per promotion. The company also promised life time monthly incomes, free trips and products if certain business targets were achieved. However, many of the subscribers did not receive income promised to them, which resulted in the police complaints.

Why did People get Duped?

• The promise of making easy money online was used to lure people to subscribe for the ‘Social Trade’ plans.
• The user interface of the website gives it a professional look (https://www.socialtrade.biz/Default.aspx ). The Website stated “we are an ISO: 9001:2015 certified company”, convincing people of the authenticity of the company.
• The subscription plan also made it appear as if the company had many clients looking for promotional services on social media.

Assessment

 Online promotions soliciting investments should be regulated by an appropriate authority. However, since the internet sans national boundaries, there are multiple vectors to be resolved. Creation of an international body for monitoring internet fraud is strongly recommended.