Mobile Banking Fraud Prosecutions
1. State of Maharashtra v. Ravi Kumar (India, 2018)
Facts:
Ravi Kumar tricked several bank customers into giving their OTPs over the phone and stole money from their mobile banking accounts. He used a cloned SIM to intercept OTPs and authorize transactions.
Charges:
Cheating and dishonestly inducing delivery of property (Section 420 IPC)
Criminal breach of trust (Section 406 IPC)
Offenses under the Information Technology Act, 2000 (Sections 66C and 66D)
Court’s Reasoning:
The court noted that Ravi’s deliberate act of obtaining OTPs through deception, coupled with unauthorized fund transfers, constituted mobile banking fraud. Evidence from call records, bank logs, and victim complaints substantiated the charges.
Outcome:
Ravi Kumar was sentenced to 5 years’ imprisonment and ordered to repay the defrauded amounts.
Legal Principle:
Mobile banking fraud involving SIM cloning and OTP interception falls under IPC and IT Act provisions on cheating and identity theft.
2. State of Delhi v. Pawan Kumar (India, 2019)
Facts:
Pawan Kumar sent phishing SMS links to bank customers claiming to be from a major Indian bank. Victims entered their login credentials and OTPs on a fake mobile banking portal, allowing him to siphon off funds.
Charges:
Cheating (Section 420 IPC)
Identity theft (IT Act, Section 66C)
Phishing and fraud (IT Act, Section 66D)
Court’s Reasoning:
The court highlighted that creating fake banking websites to obtain confidential credentials was a deliberate and fraudulent act. The digital trail of IP addresses, server logs, and bank confirmations proved the crime.
Outcome:
Pawan Kumar was sentenced to 4 years of rigorous imprisonment and fined.
Legal Principle:
Phishing for mobile banking credentials is a cybercrime under IT Act sections for identity theft and cheating.
3. United States v. Roman Seleznev (Nevada, USA, 2016)
Facts:
Seleznev, a Russian hacker, used malware to steal mobile banking credentials and credit card information from U.S. residents. He conducted thousands of fraudulent transactions via mobile banking apps and online banking platforms.
Charges:
Wire fraud
Computer fraud
Identity theft
Court’s Reasoning:
The prosecution demonstrated that Seleznev installed malware, intercepted banking credentials, and authorized fraudulent transactions across multiple accounts. His international operations aggravated the offense.
Outcome:
Seleznev was sentenced to 27 years in U.S. federal prison, the longest sentence for hacking-related mobile banking fraud in U.S. history.
Legal Principle:
Cyber-enabled mobile banking fraud is treated as a severe federal offense with long-term imprisonment, especially when involving cross-border cybercrime.
4. State of Karnataka v. Mohan Reddy (India, 2020)
Facts:
Mohan Reddy created a fake mobile banking app mimicking a popular Indian bank. Customers downloaded it and unknowingly entered their credentials, which he used to transfer funds.
Charges:
Fraud (Section 420 IPC)
Identity theft (IT Act, Section 66C)
Cheating by impersonation (Section 66D IT Act)
Court’s Reasoning:
The court observed that distributing a fraudulent mobile application to steal login credentials constitutes both IPC cheating and IT Act offenses. Expert analysis confirmed the app’s malicious nature.
Outcome:
Mohan Reddy received 6 years’ imprisonment and ordered to refund the defrauded money.
Legal Principle:
Fraudulent mobile banking apps are criminally liable under both IPC and IT Act for cheating and identity theft.
5. United States v. Mathew Martoma (New York, 2013)
Facts:
Martoma used insider information combined with mobile banking applications to conduct unauthorized securities transactions. While primarily a financial fraud case, mobile banking technology was central to executing the unauthorized trades.
Charges:
Securities fraud
Conspiracy to commit fraud
Wire fraud
Court’s Reasoning:
The court concluded that using mobile banking apps or platforms to conduct unauthorized financial activities constitutes fraud if done knowingly and to obtain financial gain.
Outcome:
Martoma was sentenced to 9 years’ imprisonment and fined millions in restitution.
Legal Principle:
Mobile banking platforms can be exploited in broader financial fraud schemes and are prosecutable under fraud and wire fraud statutes.
6. State of Tamil Nadu v. Selva Kumar (India, 2021)
Facts:
Selva Kumar sent WhatsApp messages with fake UPI QR codes to victims. When victims scanned the codes and entered PINs, he transferred money to multiple bank accounts under his control.
Charges:
Cheating (Section 420 IPC)
Identity theft (IT Act, Section 66C)
Fraudulent electronic transactions (IT Act, Section 43)
Court’s Reasoning:
The court found that generating fake QR codes for mobile banking payments was a deliberate fraud mechanism. Technical evidence from UPI logs and banking transactions substantiated the claim.
Outcome:
Selva Kumar was sentenced to 5 years’ imprisonment and fined; banks refunded some victims.
Legal Principle:
UPI-based fraud via QR codes or mobile apps is prosecutable under IPC and IT Act provisions related to cheating and cybercrime.
7. United States v. Alexsey Belan (California, 2020)
Facts:
Belan, a hacker, compromised mobile banking accounts of several U.S. residents using stolen credentials sold on dark web marketplaces. He initiated unauthorized transfers and withdrawals via mobile apps.
Charges:
Wire fraud
Computer hacking
Unauthorized access to financial accounts
Court’s Reasoning:
The court emphasized that exploiting stolen credentials for mobile banking transactions, regardless of remote or automated access, is wire fraud. The digital trail provided irrefutable proof.
Outcome:
Belan was sentenced to 8 years in prison and ordered to pay restitution to victims.
Legal Principle:
Hacking mobile banking accounts using stolen credentials is treated as wire fraud and computer crime under U.S. law.
Key Legal Takeaways from Mobile Banking Fraud Cases
IPC + IT Act in India: Mobile banking fraud is treated under Sections 420, 406, 66C, and 66D for cheating, criminal breach of trust, and identity theft.
Fraud methods vary: SIM swaps, phishing, fake apps, UPI QR scams, malware, and credential theft are all prosecutable.
Cross-border implications: Cases like Seleznev and Belan show that international cooperation is vital due to the global nature of mobile banking fraud.
Evidence: Digital evidence (bank logs, call records, IP addresses) is central to prosecution.
Punishments are severe: Sentences range from 4–27 years depending on scale, method, and jurisdiction.
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