Telangana: Police arrest another Chinese national in loan app scam
In their ongoing investigation against instant loan apps, Rachakonda police arrested another Chinese national on Wednesday. The 26-year-old Chinese national, identified as He. Jian, alias Mark, is from the Chinese province of Jiangxi. He was arrested in Bombay. An Indian, Vivek Kumar, 26, was also arrested by the police.
Chinese national He. Jian came to India in August 2019 on a business visa and joined as a representative on behalf of Chinese nationals Xu Nan, Xu Xinchang and Zhao Qiao. They are administrators of different microfinance companies.
They operated Krazy bean, Krazy rupee, cash plush, Rupee pro, Gold bowl, first cash, real rupee/rupee bear, rupee most, first cash, credit rupee, cool cash, money now, pocket rupee, rupee day, cash goo, cash star, cash bowl, cash just, cool rupee, money rupee, gold rupee, money helper, R cash, Money bell apps.
They ran call centers in Thane and Pune in Maharashtra. Rachakonda Police seized Rs 30 crore kept in the bank account of the above companies.
“We have written to Google Play Store to remove these apps. We are also approaching the Ministry of Information Technology through official channels against these apps. We have shared the FIRs with the App Directorate and have also addressed the issue with the RBI,” Mahesh said. Bhagwat, the Rachakonda district police commissioner.
The police formed special teams to investigate the case. They are also looking to expedite the case for a speedy sentencing.
CHINESE FRAUD WALLS
Investigating the mega loan app found, Telangana police face a tough challenge to crack what appears to be an international racket using cellphone-based apps to scam people.
As at least six people have taken their own lives due to alleged harassment by instant loan providers, police face a language barrier when investigating Chinese nationals arrested during the investigation and suspected of being the mastermind of fraud.
The Central Crime Station in Hyderabad has registered 190 cases related to loan application fraud, while Cyberabad and Rachakonda commissioner areas are investigating the case separately. Both also arrested Chinese nationals.
Earlier in August 2019, Hyderabad police busted an online gambling racket and arrested a Chinese national. The case is still under investigation.
Senior Telangana Police sources confirmed that while the Law Enforcement Directorate is constantly briefed on the racketeering and related investigation, they also take the help of Interpol to check the criminal backgrounds of Chinese nationals. arrested.
A preliminary investigation into financial transactions revealed that almost 1.4 crore of transactions worth almost Rs 21,000 crore have taken place so far. These transactions took place through payment gateways and bank accounts linked to these companies.
A large number of international transactions have also taken place via bitcoins. A large part of the transactions took place in the last six months.
So far, the investigation has not been able to establish whether these applications are connected to an NBFC or not.
HOW FRAUDERS WORK
The accused Chinese nationals are said to be developing instant loan applications offering loans to people between the ages of 20 and 40 with high interest rates. They are also launching several sister companies and offering loans through their online loan applications available on Google Play Store.
To obtain repayments from borrowers, they have also set up call centers in various parts of the country. These apps are developed in such a way that while installing these apps, they get access to contacts, mobile information and other data on the device. These apps collect ID proofs, PAN card, KYC documents, bank details from customers.
The applications verify the authenticity of the documents and disburse small amounts as loans to their bank accounts after deducting the processing fee and GST i.e. 25-30% in advance. There would be two categories of loan periods — 7 days and 15 days.
At the end of the due date, the customer is placed in a bucket list (S-0, S-1, S-2, S-3, M2, M3, X, etc.). The lower the bucket the borrower is in, the lower the abuse. Abuse and harassment increase with the bigger bucket.
Once a customer has been declared defaulting, the call center calls and insults the borrower in foul language and threatens dire consequences. They even go so far as to access customer contacts from their phones and start abusing and threatening family members, relatives and friends with calls and messages. They also blackmail innocent people by sending fake legal notices.
The callers suggest that the victims make the repayments by taking out a loan among their other loan applications. Customers sometimes fall into the trap of taking loans through other loan applications and end up paying huge sums, and stuck in an endless cycle.
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