Cops arrest Chinese national in instant loan apps fraud

The main accused of the operation, Zixia Zhang, and another important accused, Umapathi, are absconding.

On 17 December, the Cyber Crime Police received a complaint from a person who had used an instant loan app for his financial needs. The person had applied for a loan of Rs 2,015 for seven days and was given Rs 1,600 as a loan on 25 August after deduction of GST and other processing fee amounting to Rs 415. He was also prompted to upload his Aadhaar, PAN, a self-authentication photo and three months of bank statement to obtain the loan.

"After that, I received calls from different mobile numbers and was advised to take instant loans from their applications. On their advice, I took a total loan amount of Rs 1,20,000 from 28 instant loan applications. I repaid the loan amount with Rs 2,00,000 including interest. But the calls didn't stop. I received calls where I was threatened, abused, and warned about being blackmailed with legal notices," said the complainant.

Upon receiving this complaint, police raided Cubevo Technology Private Limited whose head office, Skyline Innovations Technologies India Private Limited, is in Delhi, registered in the ROC, Gurgaon. Its directors are Zixia Zhang and Umapati.

The police said that the accused have developed 11 instant loan apps that offer loans to individuals and collect huge amounts in return, including the interest, processing charges, GST and other charges. If the person defaults they charge a 1 per cent penalty and also resort to systematic abusing, harassing, threatening through their call centres. They even blackmail the borrowers by sending fake legal notices to their relatives and family members.

Recently, Cyber Crime Police Station, Cyberabad, registered eight cases against these loan applications.

During the course of the investigation, it was revealed that the mastermind, Zixia Zhang, with the help of his Singapore-based company, developed 11 such phone applications offering loans to individuals aged from 20 to 40 years with high interest rates. In December 2019, Zixia Zhang along with Umapati established a company and offered loans through the applications. To get repayments from the borrowers they also set up four more call centres in various parts of the country.

Here are the list of instant loan apps that users should be wary of: Loan Gram, Cash Train, Cash Bus, AAA Cash, Super Cash, Mint Cash, Happy Cash, Loan Card, Repay One, Money Box and Monkey box.

Police said that these applications were developed in such a way that on installing these apps they get access to the contacts, mobile information and other data on the device. Through these applications, the accused collect ID proofs, PAN cards, KYC documents, bank account details of the customers. They check the genuineness of the documents and disburse small amounts in the form of loans to bank accounts after debiting the processing charges and GST which amounts to 25% to 30% of the loan amount in advance.

"There will be two categories of loan period: seven days and 15 days. On completion of the due date, the customer is put under a loan bucket list. Smaller the bucket the loanee is in lesser the abusive treatment. People in big loan buckets get more abuse and harassment. They abuse the customers in filthy language and threaten them with dire consequences. They even go to the extent of accessing the contacts of the customers and start abusing and threatening the family members, relatives and friends with calls and messages," said the police.

Police also added that the fraudsters have set up call centres in different parts of south India, where telecallers make calls to customers, categorised under different buckets, and ask for huge repayments in an abusive and threatening manner. They also blackmail by sending fake legal notices. Telecallers also suggest victims make the repayments by taking loans from their other applications. Customers fall into this trap and are stuck in a never-ending cycle of paying huge amounts.

Yi Bai, a Chinese national and Chief Operating Officer of Xikai Holding Pvt Ltd came to India in February 2020 on a business visa and has been working as a business development manager at Skyline Company. He along with Satyapal identified the new locations and set up new call centres all over India.

It is not yet clear whether these applications are connected to any NBFC. The applications developed by these companies are involved in various cases registered in Cyberabad (12), Rachakonda (2) and Hyderabad (13).