In a recent incident, Bollywood actor Aftab Shivdasani fell victim to a cyber fraud scheme, losing Rs 1.50 lakh. This digital deception commenced with a text message requesting him to update his Know Your Customer (KYC) details, purportedly linked to a prominent private sector bank. Unfortunately, this isn't an isolated incident.

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KYC frauds, often facilitated by digital channels, have become prevalent. Fraudsters are perpetually on the prowl, seeking vulnerabilities to infiltrate the financial system and pilfer sensitive data.

One common tactic employed by scammers involves impersonating bank officials and coercing unsuspecting individuals into sharing their KYC details under the guise of urgency. Threats of account suspension and other dire consequences are often part of the playbook.

While digital methods have certainly streamlined the KYC process, they've simultaneously created new avenues for exploitation.

Types of KYC frauds

Some of the most common types of KYC fraud in India include:

Fake re-KYC

Scammers pretend to be banking officials, compelling customers to share their details to update KYC or face the threat of account suspension.

Phishing

Fraudsters gather customer contact information from sources like social media and pose as bank representatives, typically sending an SMS with a link to a fraudulent app or site. Victims are coerced into sharing their OTP while still on the call.

Vishing

In this scenario, fraudsters harvest user information from social networking sites, initiate a fake call pretending to represent a bank, and ask the victim to provide KYC information. Often, they convince the victim to install a malicious app and share a code, ultimately defrauding them.

Smishing

Victims receive SMS messages instructing them to call a particular number to update their KYC, a tactic known as smishing.

Identity theft

Identity theft involves someone using your personal information to commit crimes, which can lead to significant financial loss and damage to the credit score.

How to prevent KYC fraud?

Here are some crucial precautions to take:

-Customers must remember that banks do not ask for sensitive information like CVV, OTP, or ATM PIN via calls or messages.

-When customers receive an SMS or call requesting personal information, they should contact the bank directly to confirm the legitimacy.

-One should avoid opening unknown attachments in SMS or emails, as they may contain malicious software.

What to do if someone falls prey to KYC fraud?

In such a scenario, customers should notify their bank about the fraud as soon as possible. They should report the incident to their local police station as well and provide them with all relevant evidence, including screenshots, call details, and emails.

Also, they should present this evidence to the bank, and, if necessary, to local law enforcement, experts say.

It must be remembered that the battle against KYC fraud requires vigilance, awareness, and prompt action. By staying informed and acting swiftly, individuals can play a pivotal role in curbing these digital deceptions.

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(Edited by : Amrita)