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KYC Fraud: All You Need to Know

By Chanel Rick - Nov 8,2022
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How is Credit Card Fraud Monitored or Prevented?

“Hello, is this Mr. Ravi?”  

“Yes!”  

“I’m calling from XYZ Bank; you have a savings account with us” 

“That’s right”  

“It seems you haven’t completed your KYC, but we can complete it over call”  

“Great, let’s do it!” 

Except, it wasn’t a great idea. Mr. Ravi didn’t realise that this person didn’t provide him with much information to verify his details. Moreover, KYC can’t be processed over a simple call!

Shortly after the call ended, Mr. Ravi felt productive. The bank representative had asked him to download a screen-sharing app to help complete the KYC process. “That was quick! I guess that’s one thing that’s out of the way”, he thought. A few moments later, he got an OTP for a transaction, and within seconds another text appeared. A seemingly fruitful day had turned into a nightmare!

The message read, “Dear Customer, Rs. 50,000.00 debited from your A/C XX1234…”

Rise of e-KYC Fraud in India & its Types  

With every progressive year, scamsters find innovative ways to trap unsuspecting victims. In recent years, e-KYC frauds have become their new favourite. These individuals use the guise of KYC-related updates to inquire about your personal data like Aadhaar details, bank account number, etc. Despite articles, videos and other campaigns working hard to increase awareness on the matter, people still fall for these tactics.  

Back in December 2021, Reliance Jio issued a warning to its customers about an ongoing e-KYC fraud. Addressing the matter, the company wrote an email with the following statement,  

“For us at Jio, your security is always of utmost importance. In recent past, few cases related to Cyber fraud have been reported to us, in which, imposters portray themselves as Jio representatives and insist on getting the information related to your Aadhaar, bank accounts, OTP etc. mainly on the pretext of pending eKYC (Know Your Customer).” 

This type of fraud is called Vishing. In such cases, the scamsters make calls by posing as a bank or NBFC representative to lure customers into sharing their confidential details. They use a number of excuses like KYC-updation, credits or debits, etc. Unfortunately, there have been similar frauds reported.

Another type of KYC fraud is smishing. In this form of fraud, customers receive messages that inform them that their KYC requires an update. To complete the procedure, they must call the number mentioned. Since most e-wallets require complete KYC within 12 months of registering, such frauds have increased. During peak COVID-19, there was a massive surge in such crimes.

Lastly, the scam Mr. Ravi encountered is a new variant that has been on the prowl. It cleverly uses technology by asking victims to download apps like AnyDesk or Screenshare to view their screens. While the fraudster pretends to follow the KYC process, they’re actually tracking all the information visible to them. After the call drops, they fraudulently use those stolen details and debit large chunks of money from those accounts. 

Simple Ways to Identify KYC Scams  

While reading alarming narratives of those who have experienced KYC scams, it’s crucial to learn ways to identify them. That way, you can protect yourself and your loved ones from falling prey to such malicious entities. Here are a few easy ways to identify or avoid KYC scams.  

  • Never click on links sent by unknown numbers or email addresses 
  • Verify the identity of banking or non-banking representatives before engaging with them or sharing details  
  • Be wary of unsolicited calls or emails that narrate events like a relative or friend’s accident and they require urgent treatment funds (common fraud excuses/stories)  
  • Don’t add any credit card or bank account details on forms or links shared by unknown representatives
  • Avoid downloading third-party apps for KYC completion – the process doesn’t require it! 

If the caller uses a known contact’s identity, immediately confirm those details by calling the respective person. If it turns out to be false, quickly disengage and disconnect the call. Note down all the details of the caller and report the incident.

Victim of a KYC Scam? Report the Incident! 

Whether you fell for their lies or almost lost your life’s savings to such frauds, don’t let it go unreported. Every time you neglect to report such crimes, another innocent person becomes their victim. Help the authorities shut down such illegal rackets by timely reporting suspicious callers or entities, especially after encountering these frauds yourself.

Here are a few ways to report such instances as mentioned by Cybercrime prevention authorities.  

  • Submit all the details of the events that occurred from the moment the fraudster contacted the victim  
  • Attach screenshots or copies of any SMS, email or call details regarding the suspicious entity
  • Written evidence must be submitted, like screenshots of SMS/emails, bank statements, transaction alerts, etc
  • Victims need to carry these documents to the nearest local police station

But wait, don’t just hoard this information and keep it to yourself! Much like it’s crucial to report these incidents on time, you must help create awareness for it. Your personal experience may help prevent such illegal activities from spreading further. Moreover, it might stop your close relatives or friends from becoming a victim of such shady schemes! 

Now that you know how to avoid the traps set by fraudsters, check out credit cards with handsome rewards and cashback. Apply for a hassle-free credit card on Bajaj Markets today! 

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