The Arrest: Three Students, ₹6.5 Lakh, and Countless Victims
In August 2025, Hyderabad’s Cybercrime Unit unearthed a shocking development in a large-scale online fraud investigation. Three engineering students K. Hemanth Reddy (21), M. Yeswanth Reddy (21), and M. Tharun (22) were taken into custody for allegedly supplying over 40 bank accounts that became key tools in executing a complex “digital arrest” fraud scheme.These accounts were reportedly sold for a commission and were later used to defraud a 57-year-old government employee of ₹6.5 lakh by impersonating police officers via video calls and fake legal documents.
The same students are now linked to 23 cyberfraud cases across India, many tied to similar scams orchestrated from remote locations, exploiting mobile accounts and SIM fraud.
What Is a “Digital Arrest” Scam?
In a “digital arrest” fraud, scammers impersonate high-level law enforcement officers CBI, ED, or local police via WhatsApp video calls. They present fake arrest warrants, court notices, or FIRs, claim the victim is under investigation for serious crimes like money laundering, and demand large sums of money to avoid “arrest”. Victims, fearing legal consequences, transfer funds under duress.
In this case, the fraudster posed as a Deputy Commissioner of Police, citing a fictitious ₹2 crore money-laundering case, and demanded funds to “release” the individual.It was only after the damage was done that the victim discovered they had been tricked.
How It Worked: SIM Box and Bank Account Mule Networks
While this specific case didn’t disclose SIM boxes, similar scams often use SIM box devices, which can host dozens of SIM cards and mask international calls as domestic ones—making impersonation more convincing.
The students’ role centered around providing bank accounts (“account mules”) to fraudsters, enabling money transfers that obstruct traceability. These accounts become critical nodes in the fraud network, moving illicit funds across jurisdictions.
Why It Matters: Legal Framework & Criminal Exposure
For legal professionals and compliance officers, the Telangana case illustrates how India’s legal system responds to digital impersonation fraud.
The IT Act, 2000
- Section 66D: of the Information Technology Act specifically addresses fraud committed by pretending to be someone else using digital means such as phones, emails, or other electronic platforms to deceive and cheat individuals.
Bhartiya Nyaya Sanhita (BNS), 2023
- Section 318 (Cheating) under the Bharatiya Nyaya Sanhita, 2023, comes into play when someone uses deceit or misrepresentation to wrongfully gain money or property from another person.
- Section 111 (Organized Crime): Enables treating the entire scam as an organized criminal conspiracy helpful to dismantle networks behind transnational schemes.
Prosecutors can invoke these provisions to treat account suppliers or impersonators not as small-time offenders, but integral parts of a broader fraud ring.
Key Terms
- Digital Arrest Scam: A scam using video calls and fake legal documents to instill fear and induce victims to transfer money urgently.
- SIM Box: A device that holds multiple SIMs to render international calls as locally commonly used in scams to mask caller identity.
- Account Mule: A person who provides bank accounts to fraudsters, receiving payment in exchange for facilitating money laundering.
- Impersonation Fraud: Pretending to be another person—law enforcement or corporate authority to gain trust and exploit it.
- Organized Fraud Network: A structured group operating transnationally, coordinating roles like SIM suppliers, account mules, and call operators.
Broader Cybercrime Trends in 2025
- A different scheme involved fake stock tips and online trading scams, costing victims crores while funneling money via WhatsApp groups into overseas accounts.
7. Who’s At Risk and How to Protect Yourself
For Individuals:
- Never transfer money based on a scary video call alone; always verify independently using known official numbers.
- If you receive fake documents or threats of legal action, hang up and call the real institution.
- Immediately report fraud on the National Cybercrime Portal or by calling 1930.
For Legal Professionals:
- Guide clients to remain composed and verify any legal threat independently.
- Educate them about digital impersonation tactics and social engineering used by fraudsters.
- Inform victims about legal recourse under IT Act and BNS, including civil compensation and criminal proceedings.
For Telecom and Financial Institutions:
- Strengthen KYC and AML protocols to prevent misuse of bank accounts.
- Provide public-facing warnings about evolving scams, especially targeted at senior citizens and vulnerable groups.
Conclusion: Building a Digital India Means Securing It First
The Hyderabad Digital Arrest fraud is more than just another cybercrime headline, it is a wake-up call. The involvement of tech-savvy students in such a manipulative scheme shows that the next wave of cyber threats may not come from shady underground networks abroad, but from within our own systems, classrooms, colleges, and neighborhoods.
In today’s digital age, the boundary between what’s real and what’s fake has become increasingly difficult to distinguish.Cybercrime isn’t just about numbers. Let’s rebuild that trust one secure click at a time.
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