The Hindu : Front Page : Reserve Bank clamps down on forex fraud

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Saturday, Sep 13, 2008
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Reserve Bank clamps down on forex fraud

Special Correspondent

Bank issues circular for public information
Cautions people not to fall prey to frauds

Thiruvananthapuram: The Reserve Bank of India (RBI) has clamped down on fly-by-night operators making fraudulent offers of huge money in foreign exchange through letters and e-mails either as prizes in lotteries or as support to institutions including schools and hospitals.

In a circular issued for public information, the RBI has cautioned the people not to fall prey to fictitious offers of winnings in lottery coming though email, post or courier, besides making payment or remittance towards participating in such schemes or offers from unknown entities.

According to the RBI, remittance in any form towards participation in lottery schemes has been prohibited under the Foreign Exchange Management Act, 1999. RBI sources said that several cases of such fraud had come to the bank’s notice. The offers are made to resident individuals and entities, including schools and hospitals, on the pretext of helping them in their business or ventures in India.

It has been noticed that the offers are made through letters and e-mail by foreign entities or individuals or entities acting as their representatives. The usual practice of these entities is to request for details of bank account and ask for some amount to be remitted as initial deposit or commission so that the full offer amount could be transferred.

Sources said that these operators even issued documents on accounts held in the name of individuals, companies and trusts with the RBI. The bank clarified that it did not maintain any such account for disbursal of funds.

Internet users are spammed with mail informing them of lottery winnings or from fictitious characters seeking help to take money out of their respective countries. Recently, there were reports of e-mails offering employment in the oil industry in Ajuba in Nigeria for which the candidate was asked to remit $ 5,000 upfront as processing fee and other expenses like reimbursable air fair. Inquiries with the External Affairs Ministry proved that the company that made the offer was bogus.

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