Rs.16 Crore credit card racket busted

The Cyber Crime branch of Karnataka Police arrested five people, including a woman kingpin, for cheating foreign nationals of funds equivalent to around Rs.16 crore (Rs.160 million) through credit cards and E-Commerce gateways, a top police official said.

The arrested defrauded foreign nationals "by using their credit cards and bank accounts to transfer funds into their charitable trust account through the E-commerce gateway," Director General of Police Shankar Bidari told. Bidari heads the Criminal Investigation Department of the state police. "The accused have been arrested under section 65 of the Information Technology (IT) Act, 2000 and section 420 of the Indian Penal Code (IPC)," he added.

Kingpin Regina Seelam and her four associates -- Victor D'Souza, Christy Solomon, Thomas Joseph and Selan Babu -- had set up the Salve Regina Charitable Trust in the city in 2005 to look after senior citizens and orphaned children. After registering the trust under the Societies Act, the accused obtained approval from the union home ministry for receiving contributions from foreign countries and Income Tax exemption from the union finance ministry in 2009.

"The accused opened a website ( for contributions from the world over to serve old people and orphans. They also opened an account with Standard Chartered Bank in Chennai for an e-commerce gateway to transfer funds equivalent to Rs.1.5 million online from debit and credit cards of foreign nationals," Bidari said, citing the First Information Report (FIR).

When the duped foreign nationals complained to their respective banks about the illegal transactions, Stanchart stopped the trust's E-commerce gateway and terminated its account to investigate the transactions. After lying low for over a year, the trust opened a similar account with ICICI Bank in Bangalore with facility for e-commerce payments in April 2010. "For about three months, the transactions were minimal and irregular. But from July 1-Aug 13, 2010, there were 995 transactions equivalent to Rs.15.68 crore. Most of the funds were transferred through credit and debit cards of overseas nationals without their knowledge," Bidari recalled.

On receiving complaints from overseas banks that funds of their customers, including credit-card holders were siphoned off in unauthorized way, ICICI Bank cancelled the trust's account and lodged a complaint against the trustees with the city's Cyber Crime branch.