Mumbai: In what investigators describe as one of India’s most sophisticated cyber frauds, the Maharashtra Cyber Police have uncovered a massive “digital arrest” scam that defrauded a 72-year-old share trader of ₹58 crore.
According to officials, the fraudsters used an elaborate network of 6,500 bank accounts across India to circulate, layer, and conceal the stolen funds — a scale never before seen in a single cybercrime case.
So far, seven suspects — including account holders and handlers — have been arrested, while several others remain under investigation.
A network of 6,500 accounts to mask money trail
The Financial Crimes Unit of Maharashtra Cyber Police said the accused created an intricate system to ensure that funds were transferred instantly between accounts, making it almost impossible for authorities to trace or freeze the money.
A senior investigating officer explained:
“The fraudsters mapped an interlinked network of accounts across states. Some were used to withdraw funds through cheques, while others acted as pass-through accounts for rapid transfers through ATMs and online channels. By the time a suspicious transaction was reported, the money had already passed through multiple accounts.”
Investigators added that the gang deliberately ensured that CCTV footage would capture only one person per transaction, further complicating identification efforts.
Fake ED and CBI officers orchestrated the ‘digital arrest’
The scam began on August 19, when the elderly trader received a call from men posing as officials from the Enforcement Directorate (ED) and the Central Bureau of Investigation (CBI).
Claiming to have detected “illegal transactions” linked to his bank account, they falsely accused him of money laundering and said he was being placed under “digital arrest.”
To reinforce the deception, the fraudsters sent forged government documents bearing fake logos and seals, instructing the victim to transfer his funds to “safe verification accounts” for audit. Between August 8 and October 19, the trader and his wife transferred ₹58.13 crore through RTGS to accounts across 18 banks in Maharashtra, Gujarat, Delhi and other states.
How the fraud was detected
The scam surfaced when the victim’s bank flagged multiple large, unusual transfers and alerted cyber police. Investigators froze several accounts and began tracing the fund flow.
Among those arrested were three mule account holders —
- Abdul Khulli (47), Malad, Mumbai
- Arjun Kadwasra (55), Chira Bazaar
- Jetharam (35), Mumbai Central
They allegedly lent their accounts for commission. Four more suspects were arrested later.
The accused have been booked under provisions of the Indian Penal Code, the Information Technology Act, and the Prevention of Money Laundering Act (PMLA). Police believe dozens of other account holders across India may have unknowingly aided the scam.
International link: Calls traced to Laos and Cambodia
Investigators revealed that the fraudulent calls originated from Laos and Cambodia, which have become known hubs for organised cybercrime targeting Indians.
These rackets typically operate from overseas call centres, where trained operators impersonate Indian officials using AI-generated voices, spoofed caller IDs, and forged documents.
“These syndicates combine intimidation, impersonation and money laundering,” a senior officer said. “They exploit citizens’ fear of government action to extract huge sums instantly.”
Authorities suspect that part of the stolen money was converted into cryptocurrency and transferred via foreign exchanges, before being channelled back into India through mule accounts.
Cyber expert: ‘Digital arrest is a psychological weapon’
Cybercrime expert Prof. Triveni Singh, former IPS officer, said the case marks a disturbing evolution in the nature of cyber fraud.
“The so-called ‘digital arrest’ is not just a financial scam — it is a psychological weapon,” he said.
“Fraudsters manipulate fear and authority to make victims act impulsively. Even educated professionals fall prey because they fear legal trouble.”
He added that the scam demonstrates a shift from hacking computers to hacking human psychology and urged authorities to run nationwide awareness drives to help citizens identify such frauds.
Maharashtra Cyber seeks Interpol assistance
The Maharashtra Cyber Police have sought assistance from Interpol and foreign law enforcement to track the masterminds. Coordination with the Reserve Bank of India (RBI) and major banks is also underway to tighten detection of multi-account layering and mule transactions.
“Our goal is not only to arrest local operatives but to dismantle the international syndicate behind them,” a senior officer said.
Police are also working with cryptocurrency exchanges to trace wallets linked to the ₹58 crore fraud.
A wake-up call for Digital India
Experts say the case underscores how fear, not malware, has become the new tool of cybercriminals.
“Digital arrest scams weaponise fear, authority, and technology,” Prof. Singh said. “Unless digital literacy improves across all sections of society, even the most vigilant citizens can become victims.”