"With changing times, the face or interface of crime has changed and criminals have become faceless in cyberspace. In the cyberspace, you get fooled because the fraudsters are smarter than you. So be cautious, alert and on the vigil that will protect in the cyberspace," says Sanjay Saxena, Joint Commissioner of Police (Crime) at Mumbai. He was speaking as Chief Guest at the seventh session under the "Police & You" series.
Moneylife Foundation with Police Reforms Watch and support from Saraswat Bank have launched the 12-week program (every Wednesday) that aims to spread knowledge about protecting yourself, your rights, the Indian Penal Code (IPC), cybercrime and economic offences. This was the seventh such session.
Mr Saxena, the 1993-barch senior IPS officer, who was Special Inspector General with Force One, an elite counter-terrorism wing of Maharashtra Police formed after 26/11 terror attack, says, "If you have lost money to email or SMS or phone calls, the only thing to blame is your greed. Basic human nature and weaknesses does not change. Even my father lost money to insurance related scam. Your precautions only will save and protect you".
The event was held in the well-appointed auditorium of Saraswat Bank headquarters, Eknath Thakur Bhavan.
The seventh session of the 12-week series on "The Police & You: Cyber Crime & You: Rights & Protection" was conducted by Adv Prashant Mali and Ramesh Mohite, former Police Officer and Director at Cyber-I Consultancy Services Pvt Ltd.
Adv Mali, who appear as expert legal counsel in cybercrime and electronic and digital evidence related cases, says, "Digital literacy, safety and security comes with dissipated awareness and knowledge of safeguards and laws governing the Internet usage. Laws in India, though enacted with full vigour, are not implemented with the same josh. Common IT user often do not know various sections of laws and there rights under the law. I find it difficult to digest that educated people cannot differentiate between civil or criminal remedies available to them under law."
The incidence of cybercrime is on the increase because of increased use of technology and its careless application. According to Adv Mali, every year there are estimated three crore incidents of bank phishing that cost about crores of rupees to customers.
"Every month, I handle over 40 cases related with phishing and bank frauds. I would strongly urge everyone to change your passwords often and do not share it with anyone, including your spouse, friends or even children. Secure your computer or laptop by activating firewall, using good anti-virus and malware protection software. On social media like Facebook Twitter and YouTube, keep your security settings at the highest point. Do not forget to secure your mobile phones and use updated apps and softwares. Be careful while sharing your personal information like name, address, contact number and financial information over the internet. And if you are a victim, first report to the police and contact the right lawyer, who knows about cybercrimes," he said.
As per the information submitted in the Parliament, the number of cases related with cybersecurity are increasing rapidly. During 2013, there were 5693 number of cases reported, which increased to 9,622 and 11,592 cases in 2014 and 2015, respectively.
According to Adv Mali, even though penetration of ecommerce and usage of internet banking has increased, the safety related knowledge but knowledge related to remedies under law is yet to sink in with the common person using Internet for commercial activities.
Talking about online defamation or abuses, Adv Mali, says, "For people seeking recourse to the law to fight online defamation or abuse, section 66A of the IT Act, 2000 would be the best option to register a case under, as it is comprehensive in the wordings and can be widely interpreted and applied. The section was included wide amendment of 2008, and deals with the sending of offensive messages through communication services. It is also an anti-spam law of India."
According to Mr Mohite, who during 2000 started first Cybercrime Investigation Cell while serving in the Maharashtra Police, everybody is at the risk of falling prey to a cyber attack as no network is secure enough to stand the test of hackers’ incessant efforts to break into every network, every computer that contains valuable, critical, secret information, be it a Government owned computer system or a corporate owned server farm.
"Fortunately, Indian Cyber Law, the Information Technology (Amendment) Act, 2008, provides sufficient protection to victims of such cybercrimes and addresses grave concern of cyber victims to a sufficiently large extent. Adjudication authority in the form of Adjudication Officer, bestowed with all the powers of Civil Courts, expeditiously disposes off various litigations filed before them and have given considerable relief to the affected parties. Police authorities have been sufficiently trained to handle the investigative aspect of cybercrime, thus gaining the trust of business community and citizens at large," he said.
Mr Mohite, who was involved in the investigation and arrest of first hacker of India, who had hacked into a law enforcement website under the pseudonyms Dr. Nuker and Da Libran, says, “Digital evidence is volatile in nature and can be easily altered. Hence, from the time the computer crime happens, computer forensic process starts. One of the cardinal principles of handling digital evidence is ‘never work on original evidence’.”
He said, “The moment any cybercrime incident is reported, the first stage of computer forensic of acquiring digital evidence starts. Since you are not supposed to be working on original evidence, you are barred from directly inspecting the contents of the storage media. This deprives you from having a first glance at the digital trail left by the cybercriminal. Here the computer forensics comes to your rescue and allows you to take exact bit stream copy of the storage media without violating the sanctity of original evidence. Taking bit stream copy of storage media is also called as imaging the media. This helps in tracking and subsequently to the arrest of the cybercriminal.”
The Jamtara connection of fraud calls
Both Adv Mali and Mr Mohite mentioned about a booming business of cyber frauds originating from a far away district of Jamtara in Jharkhand. According to Adv Mali, people, mostly youngsters have formed groups for making calls and duping people across the country by pretending to be calling from a bank. These people assemble in the morning and then split in a group of two-three to start calling people while seating in the bamboo. They have two mobiles handset, one a basic phone and a smartphone.
The basic phone is used to make calls while the smartphone is kept on standby with an e-wallet opened. The caller identifies himself as a bank representative and tells the call received that the account is up for verification or expiry. Once the card details of the individual are entered into the e-wallet, the transaction mostly requires a onetime password (OTP) from the call receiver to authenticate. At this point, the caller tells his target that he had sent across a code for him, which he required to verify the account. Once the call receiver reads out the number, the transaction is complete. So by the time, the call ends, the call receiver may find substantial amount have vanished from his account.
Adv Mali said, the mobile tower outside one village, Kala Jharia sees over 3,000 outgoing calls, mostly to Mumbai, on a daily basis. The average calls originating from a mobile tower is about 700 to 800. "This surge is since past few years. During this period, not many people from Jamtara district moved to Mumbai, so this surge should have alerted mobile operators. But nobody is bothered. All these calls are used to defraud people across the country," he added.
During 2015, police teams from 10 states have arrested 28 individuals from Jamtara in 22 cases, all of them residents of Karmatar police station limits.
According to Adv Mali, there are two ATMs operated by State Bank of India (SBI) in Karmatar in Jamtara district. The Bank deposits around Rs5 to Rs10 lakh in one ATM, while the other gets filled with about Rs15 to Rs20 lakh every day. However, cash from the first ATM gets over in few hours while the cash in the second machine last hardly for a day.
The rally in bonds and equities of emerging markets post ‘Brexit’ referendum may slow down (if not reverse), according to Kotak Securities. This is due to a potential policy normalisation by the US Federal Reserve over the next few months and limited potential of accommodation from other central banks. Besides, Indian stocks have rallied so much recently that there is no attractive value left in the market, thinks Kotak Securities. “Fundamentals of the Indian market are good, but not as great as what stock prices make them out to be,” says a report released today. The firm expects modest future returns. It is difficult to find good opportunities in the Indian market given the current valuation scenario.
It expects the earnings for Nifty-50 companies to rise by 15% in FY16-17. Among the different sectors, cement, media and metals will be out-performers. Earnings for metals and mining sector are expected to rise by a whopping 51%. However, the low base effect for the sector has to be taken into consideration – earnings for FY15-16 fell by 20.7%. Earnings for cement and media are expected to jump by 46.7% and 32.9% respectively in FY16-17. Telecom and energy are expected to be laggards in Nifty – 50 with their earnings expected to decline by 9.7% and 3.9% respectively.
Sectoral Outlook: Kotak Securities does not have a very positive views on consumption, Information Technology (IT) and pharmaceutical sectors. Valuation in consumption sectors is very rich. In certain cases, they are ‘absurdly rich’ as per the report. It has worsened in certain external sectors like (IT) and pharmaceuticals.
Bond Markets: The bond yields in developed markets have fallen to low levels given the policies fallowed by central banks. The yield in bonds has not declined much. However, it hardly means that risks have declined. There is a difference in nominal yields for government bonds for emerging markets and developed markets. However, according to Kotak Securities, this is due to inflation differential due to which the ‘nominal’ benefits would be nullified in theory.
The world is flush with liquidity. A whopping US$ 26 billion has been invested in global equities and bonds in the past 3 months. Global asset prices have risen in the past 5-6 years due to sustained purchases of government bonds, corporate bonds and equities. In addition, low interest rate policies have added fuel. What would happen if the global liquidity were to reduce? This was a question that Kotak Securities sought to answer. They carried out a mental exercise to find out the valuation multiples of various sectors and high profile stocks in India? In order to do this, they assumed a cost of equity of around 12% and the long-term risk-free rate of around 7%. In several cases, this exercise fetched a 20-40% lower multiple. According to Kotak Securities, the current re-rating in Indian equities is due to analysts using ‘global cost of equity’ as opposed to cost of equity for Indian markets as bond yields have come down dramatically in developed markets.
Markets are looking at the direction of US Federal Reserve policy to sustain the recent market rally. The US economy has gradually strengthened, especially in the area of employment. With this along with US Fed governors’ comments, the global markets have marginally recalibrated their expectations of an increase in US Federal Reserve rate. Kotak Securities has pegged the probability of US Fed rate increase by December 2016 at 44%.
Changes in Model Portfolio
Kotak Securities has dropped Tata Consultancy Services (TCS) from its model large-cap portfolio due to expensive valuations as compared to other Tier 1 names. Earnings and revenues in dollar terms for the sector have remained relatively stagnant. It added Indigo (InterGlobe Aviation) and transferred Petronet LNG to this portfolio. It also reduced Indian Oil Corporation’s weight in its portfolio.
It has entirely dropped its recommended mid-cap portfolio on valuation concerns as there is not much upside left for stocks in its portfolio. Out of 11 recommended stocks, five stocks were trading either above or close to 12-month fair valuations. It has not created a portfolio with a small number of mid-caps as it believes that a basket approach works best for mid-caps. According to Kotak Securites, only some stocks in infrastructure and real estate sectors offer some meaningful upside from a 12 month time horizon.
We had mentioned in our Tuesday’s report that Nifty, Sensex has broken out of its trading range. Today too the benchmarks made an upmove. From here we see Nifty, Sensex continuing to rally further.
India VIX closed at 13.2425, up 1.71%. NSE recorded a turnover of 146.79 crore shares.
Nifty and Sensex hit their new 52-week highs again today. The benchmark indices initially opened on a flat-to-positive note on Wednesday prompted by mixed cues from Asian and European markets. Market awaited the announcement of the gross domestic product (GDP) data for the first quarter of 2016-17, among others.
In addition, the upward trend of the indices continued as foreign institutional investors (FIIs) resorted to buying activities, unleashing a fresh inflow of funds.
The indices marginally capped gains due to a sharp up-move in the dollar index and lower crude oil prices and pulled the markets back from their morning peak levels.
However, gains in the rupee's value kept the market sentiment buoyed to close with appreciable gains.
The rupee appreciated by seven paise to 66.96 against a US dollar from its previous close of 67.03 on Tuesday.
In terms of investments, provisional data with the exchanges showed that the FIIs purchased stocks worth Rs 854.19 crore and the domestic institutional investors (DIIs) bought scrips worth Rs 847.70 crore.
The top gainers and top losers of the major indices are given in the table below:
The closing values of the major Asian indices are given in the table below: