In an alarming evolution of cyber fraud in South and Southeast Asia, scammers are deploying a terrifyingly effective scheme known as the “digital arrest” scam. Victims—ranging from a 90-year-old retired man in Gujarat to a young job aspirant lured to Nepal—have been manipulated into transferring huge sums of money after being falsely told they were under investigation.
In Gujarat, a senior citizen was tricked into transferring ₹1.25 crore (approx. USD $149,700) to fraudsters impersonating police and enforcement agencies. Meanwhile, a young jobseeker, tempted by a fake offer, was taken to Kathmandu, Nepal, locked in a hotel room, and forced to lend his identity and bank account to launder nearly ₹49 lakh (USD $58,680).
In both cases, the funds were moved swiftly, often across borders and via digital assets, making traditional investigative methods insufficient. However, what criminals thought was untraceable turned out to be their biggest vulnerability: cryptocurrency.
How Crypto Became a Tool for Law Enforcement
Contrary to popular belief, crypto isn’t a black hole for stolen funds. Every transaction on the blockchain is recorded, timestamped, and publicly verifiable—leaving a digital footprint that’s often more traceable than cash.
In these cases, Indian law enforcement leveraged blockchain data with critical assistance from Binance’s Financial Intelligence Unit (FIU). Binance shared wallet addresses, flagged suspicious transaction patterns, and helped track down mule accounts being used to obscure fund movement.
In Ahmedabad, police arrested a man who had “rented” his bank account to cybercriminals as part of a ₹22 lakh (USD $25,350) scam. He allowed scammers to channel funds from a senior citizen who believed he was settling fictitious legal charges. The use of such mule accounts—often ordinary people tempted by small sums of money—adds layers of complexity to the crime, but also leaves multiple points for investigators to trace.
Binance’s behind-the-scenes analytics helped law enforcement act swiftly before the digital trail went cold. The suspects in both cases have been apprehended, with investigations ongoing to identify the broader networks involved.
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Global Collaboration is the New Frontline in Cybercrime Control
These scams, though executed locally, are undeniably global in nature. Funds are siphoned within hours, cross international jurisdictions, and often end up being laundered through crypto assets. To counter such agility, law enforcement agencies require equally nimble and cooperative allies.
Binance, through its FIU, responded to over 65,000 law enforcement requests globally in 2024 alone, signaling its growing role as a partner in digital crime-fighting. In the Gujarat and Kathmandu scams, their real-time support proved vital.
A senior officer from the Ahmedabad Cyber Crime Branch commented:
“This case highlights the growing sophistication of cyber scams and the need for cross-border cooperation. With timely support from Binance’s FIU team, we were able to trace the crypto trail, identify key suspects, and move quickly on arrests.”
The incident underscores a crucial truth in modern cybercrime enforcement: crypto is not anonymous, it is accountable. With the right tools, expertise, and partnerships, digital crime can be traced, and justice delivered.