The Government of India has taken a significant step to address the growing menace of digital arrest scams by constituting a high-level Inter-Departmental Committee to examine accountability, preventive measures, and compensation mechanisms for victims. These scams, which have emerged as one of the most disruptive forms of cybercrime in India, involve fraudsters impersonating law enforcement officials to coerce citizens into transferring large sums of money. In a status report filed before the Supreme Court on Tuesday, the government detailed the committee’s initial findings and recommendations.

Committee Mandate and Composition

The committee, formed under the chairmanship of the Special Secretary (Internal Security) in the Ministry of Home Affairs, was constituted on December 26 following guidance from Attorney General R Venkataramani. Its membership spans multiple central agencies and ministries, including senior officers from the Reserve Bank of India (RBI), the Department of Telecommunications (DoT), Ministry of Electronics and Information Technology (MeitY), National Investigation Agency (NIA), Delhi Police, and the Indian Cyber Crime Coordination Centre (I4C). The panel is set to meet every two weeks to coordinate policy recommendations, review regulatory gaps, and evaluate enforcement challenges associated with digital arrest scams.

The committee’s mandate includes assessing enforcement mechanisms, reviewing the findings and recommendations of the court-appointed amicus curiae, and suggesting corrective measures to mitigate the impact of these scams on citizens. One of the central principles established during the committee’s first meeting was that victims should not bear financial losses arising from negligence on the part of banks, telecom operators, or other regulated entities.

Background: The Digital Arrest Scam Crisis

Digital arrest scams have grown rapidly in India, particularly targeting elderly citizens and professionals through highly sophisticated online techniques. Fraudsters typically impersonate law enforcement agencies, including the Central Bureau of Investigation (CBI), police, or customs authorities, using video calls and fabricated legal documents to instil fear and urgency. Victims are often coerced over hours or days into transferring significant sums of money to purported “safe accounts,” sometimes exceeding ₹1 crore.

In October 2025, the Supreme Court took suo motu cognisance of these scams following complaints from victims. One high-profile case involved a 73-year-old woman from Ambala who reported that fraudsters posing as CBI officials used fake Supreme Court orders to compel her to transfer over ₹1 crore. The Supreme Court Advocates on Record Association (SCAORA), led by its president Vipin Nair, intervened to highlight similar cases, including one involving a woman advocate defrauded of more than ₹1 crore.

The scale of the crisis is significant. Data tabled in Parliament indicates that in 2024, India recorded over 2.2 million cybercrime incidents, with financial losses totaling ₹22,845 crore. Approximately 85% of these cases involved online financial fraud, underlining the urgent need for systemic reforms in both preventive and compensatory mechanisms.

Division of Investigative Responsibilities

During the committee’s meeting on December 29, the CBI proposed a structured approach to distributing investigative responsibilities based on monetary thresholds. Under this framework, state and Union Territory law enforcement agencies would handle cases below a certain financial limit, with technical and operational support provided by the I4C. Cases involving higher-value frauds would be handled directly by the CBI, ensuring central oversight and coordination for large-scale or cross-border criminal networks.

The CBI emphasized that these scams are often orchestrated by organised, transnational syndicates leveraging sophisticated infrastructure and coordinated networks. The agency noted that INTERPOL channels are frequently used to dismantle modules operating from multiple jurisdictions. To facilitate this threshold-based approach, the I4C was instructed to provide detailed case data to the CBI, enabling efficient allocation of investigative resources. The CBI also confirmed plans to host a national cybercrime conference with the I4C on January 10–11 to strengthen inter-agency coordination and knowledge sharing.

Banks, Telecoms, and Regulatory Oversight

The committee has directed the RBI, DoT, and MeitY to examine mechanisms for victim compensation and to identify areas where regulated entities may be held accountable for negligence.

The RBI submitted a comprehensive report indicating that banks already operate under multiple advisories and master directions relating to fraud prevention and transaction monitoring. Twenty-three banks have adopted the AI-based MuleHunter tool to detect suspicious “mule” accounts used by fraudsters, while the remaining institutions are being urged to implement the tool. The central bank is also finalizing a standard operating procedure for freezing accounts in suspicious transactions, in line with interim directions issued by the Kerala High Court.

The RBI clarified that proactive account freezing under Section 12AA of the Prevention of Money Laundering Act (PMLA) would require notification from the Union finance ministry. Meanwhile, CBI asserted that banks could act against predicate offences such as cheating or theft without invoking PMLA, allowing them to freeze accounts and prevent further losses.

The DoT highlighted ongoing stakeholder consultations for draft rules under the Telecommunications Act, 2023, addressing negligent SIM issuance and multiple SIM allocations to single individuals. Draft rules to regulate SIM boxes are also at an advanced stage, aimed at preventing fraudsters from using multiple mobile connections to orchestrate scams.

MeitY emphasized consultations on intermediary obligations, technical feasibility, and compliance mechanisms to hold digital platforms accountable. The ministry acknowledged the need to strengthen adjudication mechanisms under Section 46 of the Information Technology Act, 2000, potentially through a national online portal for grievance redressal.

Platform-Level Engagements

In line with these recommendations, MeitY convened a meeting on January 6 with major IT intermediaries, including Google, WhatsApp, Telegram, and Microsoft. Senior advocate NS Nappinai, appointed as amicus curiae by the Supreme Court, also participated. The discussions focused on platform-level interventions, including detecting and mitigating scams, improving reporting mechanisms, and ensuring rapid response to user complaints. A separate virtual meeting on January 2 reviewed regulatory recommendations on SIM issuance, bank liability, intermediary obligations, and mechanisms for victim redress.

Way Forward

The committee has requested at least one month from the Supreme Court to complete consultations with all stakeholders and submit a consolidated outcome. While DoT and RBI have already provided detailed inputs, responses from other members are awaited. The Supreme Court was scheduled to take up the matter on Tuesday but deferred it due to time constraints.

The government’s approach highlights a coordinated multi-agency strategy to combat digital arrest scams. By assigning investigative responsibilities based on monetary thresholds, strengthening banking and telecom safeguards, engaging IT intermediaries, and creating mechanisms for victim compensation, authorities aim to mitigate both the immediate and systemic risks posed by these sophisticated criminal operations.

Experts have noted that digital arrest scams not only pose financial risks but also psychological trauma for victims, particularly the elderly. The Supreme Court’s involvement underscores the judiciary’s role in ensuring that regulatory and law enforcement agencies act decisively to protect citizens, preserve trust in financial and communication systems, and deter criminal networks exploiting digital vulnerabilities.

With cybercrime continuing to expand in scale and sophistication, the committee’s work is expected to provide a framework for balancing regulatory compliance, law enforcement oversight, and consumer protection. Observers say the recommendations could pave the way for a model of proactive risk management in cybercrime, where technological tools, regulatory safeguards, and coordinated investigation protocols work together to reduce harm to citizens while ensuring accountability for banks, telecoms, and digital intermediaries.

In conclusion, the creation of this inter-departmental committee reflects the government’s recognition of the severity and urgency of digital arrest scams. By integrating inputs from banking regulators, telecom authorities, IT platforms, and law enforcement agencies, the committee aims to deliver a robust, multi-pronged response that prevents scams, holds negligent actors accountable, and ensures fair compensation for victims, reinforcing public confidence in India’s digital and financial ecosystems.