Loan app fraud: Chennai police nab two Chinese nationals from Bengaluru

Chennai

The arrests were made in Bengaluru following a couple of suicides in the state after borrowers were unable to tolerate the harassment for not paying exorbitant interests.

Those arrested have been identified as S Pramoda (28) of Doopanahalli, C R Pavan of Chikkanahally in Karnataka, Xia Ya Mau (38) and Yuvan Lun (28).

Police said that the accused had employed more than 100 men in call centres to make abusive calls to retrieve the loans offered through a dozen of micro-lending mobile phone applications. Their phones and laptops have been confiscated.

"The employees were paid Rs 8,000 monthly and were given a target of at least 10 loan retrievals per day," said a senior official of the Central Crime Branch.

Two more suspects — Chinese nationals Hong and Wandish, both — fled to Singapore two weeks ago and are suspected to be the kingpin behind the racket.

According to the police, Pramoda and Pavan came across an advertisement by the Chinese gang on Naukri website to setup a call centre in Bengaluru. The duo approached them and agreed to a deal.

"The men in Bengaluru had to register the company and recruit callers, while the Chinese nationals supplied the money," said the officer. 

Although the accused told the police that most of the micro-lending apps were developed by one Nutham Ram, officers suspect that the apps must have also been developed by Chinese nationals in a way to get access to the contacts and galleries of borrowers. 

"It is not clear where the money comes and where the money retrieved from borrowers are going. Also, the concept of micro-lending apps became popular only after the lockdown came into effect due to COVID-19. Further investigation is underway," said the officer.

Pramoda and Pavan set up the call centre in Bengaluru

In a similar incident, the Hyderabad police too have arrested a Chinese national among 16 others in connection with the loan app fraud. At least 27 cases have been registered following at least three suicides over a month. But, the Central Crime Branch police have registered one case based on a complaint by one Ganesan of Vengaivasal and four more similar complaints have been forwarded to CCB from Adyar police districts. Each district might have registered cases separately, said the police. 

Lure of micro-lending apps
The complainant Ganesan came to know about the micro-lending apps through social media and borrowed Rs 5,000 using it. While he got Rs 3,500 after Rs 1,500 was deducted as interest for a week, he was unable to settle the loan by paying Rs 5,000 within a week. So, every week, he had to pay Rs 1,500 as interest. Ganesan ended up borrowing from similar apps. As the loan sum mounted, the apps increased the interest by 2 per cent for every Rs 100 per day. When he could not repay the loan, he started getting abusive calls from the lenders. His relatives also started getting calls enquiring about Ganesan. This indicated that the apps granted access to the borrowers' contacts. "This is nothing but modern mode of usury and all non-bank financial institutions should be controlled," said a senior officer.

Apps handled by Bengaluru-based call centre

    *M Rupee
    *My Cash
    *Aurora Loan
    *Quick Loan
    *Dmoney
    *Rapid Loan
    *Eazy Cash
    *New Rupee
    *Rupee Loan