Hyderabad Police have frozen 75 bank accounts holding Rs 423 crore in connection with a multi-crore money lending scam that was being run on 30 mobile phone application not approved by the RBI, that charged victims up to 35 percent interest.
The matter came to light after three people died by suicide after reportedly being harassed and humiliated by money lenders. Telangana Police were alerted and authorities conducted multiple raids in Hyderabad and Gurgaon arresting 16 people, according to ANI.
Cyberabad police carried out an independent investigations and arrested seven, including an engineer with degree from US. One 32-year-old Sarath Chandra ran the money lending operation through two companies- Onion Credit Pvt Ltd and Cred Fox Technologies and used to sell loan applications to companies in Bangalore.
The firms were operated through companies registered at Bengaluru and had call centres in Gurgaon and Hyderabad. Police officials said that call centres employed hundreds of youngsters to lure customers, and lure them into borrowing successive sums from mobile apps and trained to “abuse, defame and blackmail” to recover borrowed money and the interest.
The scale of the fraud could be apprehended by the fact that over 1,000 people mostly college graduates were employed in three call centres and paid between Rs 10,000 to Rs 15,000.
According to officials a ‘multi-city’ investigation is required to understand the extent of the scam. The money was routed through shell companies, multiple bank accounts, payment gateways and digital wallets to avoid detection.
RBI on Wednesday cautioned individuals and small businesses against falling prey to such unauthorized digital lending platforms and mobile apps that promised hassle-free loans.
"These platforms charge excessive rates of interest and additional hidden charges, adopt unacceptable and high-handed recovery methods and misuse agreements to access data on mobile phones of borrowers," RBI said.