Petrol Pump Dealership Scams in India 2020

Petrol Pump Dealership Scams in India 2020

Petrol Pump Dealership Scams in India 2020:

Petrol pump business is often considered a profitable venture with great Return on Investment (RoI). The time needed for reaching break-even point is also considerably less. As a result, the number of people looking to acquire petrol pump dealership is far greater than the permitted limit by competent authority. 

The process to attain petrol pump dealership is quite a complex. In general, without political pedigree it’s a herculean task to gain the same. Therefore, people aspire to gain petrol pump dealership even by unfair means or by charting unconventional short-cuts. 

In any economy, the demand and supply determine the actual worth of a product/ services. Since, supply is far lesser than demand, petrol pump dealership has great value and this opportunity is being en-cashed upon by the fraudsters. 

Modus Operandi:
Fraudsters need an interface to attract gullible citizens for petrol pump dealership, and nothing can be better than virtual world which can provide anonymity. Therefore, fraudsters create fake websites with domain name that appear as genuine petrol pump dealers. E.g., www.reliancepetroleum.org Once people looking for such dealership contact the fraudster, they seek personal details and documents to gain the faith of the target. 

At the same time, often the process involves sending fake / forged documents to prove that they are genuine dealers. They also show fake documents of having given dealership to several customers. 

Once the victim starts reposing faith in the fraudster they make the victim pay large sums of money on different pretext like processing charges, pre booking cost, token sum, NOC for licence, insurance fee, security deposit etc. The amount collected from targets may range from few lacs to even in crores. 

Press Note in Petrol Pump Dealership Fraud by Mohali Police:
As stated in the press note issued by Shri. Kuldeep Singh Chahal IPS, SSP District SAS Nagar (Punjab) that Cyber Cell and CIA staff of District SAS Nagar (Punjab) has succeeded in tracing and arresting five members of the fraudulent gang. This gang was targeting innocent citizens by creating a fake website regarding petrol pump dealership provider and assuring them of petrol pump dealership and getting money from them in their fake bank accounts. 

In this regard FIR No. 79 dated 15-05-2020 u/s 406,419,420,465,467,471 IPC PS Mattaur, District SAS Nagar (Punjab) was registered. An accused Asif Khan s/o Nasir Khan r/o #14 Jeevan Shah Cantonment Jhansi, UP, aged 38 years was arrested from Kharar, district SAS Nagar (Punjab) in the case. He said in his interrogation that his colleagues live in Gwalior (Madhya Pradesh) and Hamirpur (UP). 

Under the guidance of Shri. Kuldeep Singh Chahal IPS, SSP District SAS Nagar (Punjab), Smt. Rupinderdeep Kaur Sohi PPS, DSP Cyber Crime, District SAS Nagar (Punjab) and Incharge CIA Staff, District SAS Nagar (Punjab) along with police party raided in Gwalior (Madhya Pradesh) and Hamirpur (UP). The accused Mahinder Singh s/o Moji Ram r/o Kabir Colony Gwalior Madhya Pradesh aged about 25 years, Brahma Prakash Shukla s/o Brij Lal Shukla aged about 41 years, Jatinder Singh s/o Annah Singh aged about 29 years and Akash Singh alias Raju Singh s/o Pooran Singh aged about 25 years all r/o vill Imlia, PS Muskra District Hamirpur (UP) was successfully arrested. 

In Preliminary inquiries of this gang revealed that they used to advertise online for a petrol pump dealership in various states such as Madhya Pradesh, Bangalore, Chhattisgarh, Rajasthan, Gujarat, Orissa, Uttar Pradesh, Manipur, Assam and Karnataka. Then this gang target innocent people who read their advertisements and contact them. They were then lured to the petrol pump dealership to get money from this gang in various bank accounts. After that this gang sent them fake approval letters and fake licenses. 

When victims would try to ask about the dealership and later this gang switched off their phones. Thus far, this gang has been defrauded around One Crore Rupees accordingly the investigation. During the investigation, Rs 4.90 lakhs in cash, a Scorpio vehicle, two laptops, several mobile phones and SIM cards used in this case have been recovered from the accused. 

The accused have total 21 accounts in various banks. In which so far around Rs 1 crore has been fraudulently deposited by this gang from the general public. Rs 2.5 lakh has been frozen in the bank accounts. Accused have been produced in a respectable court and police remand has been obtained and are being questioned in more depth. The case is under investigation.

How Frauds Perpetuate:
Fraudster often ask victim to deposit money in “money mule” accounts, created for fraudulent purposes. The accounts are fake and created by mastermind in name of other persons, who are paid for letting use their account for fraudulent purposes. 

The numbers used for communication with the victim are either acquired by giving fake documents to TSPs or by using SIMs of vagabonds etc. 

Finally, once the victim pays the money to the fraudsters, they stop responding to calls or keep on giving false assurance that their dealership is being processed. However, the victim never acquires the dealership and ends up losing their hard earned money. 

How to Prevent Dealership Scams:
Since the process involves creation of fake and fraudulent websites, you should know the process to detect them, as described below:

  1. Use http://viewdns.info/whois website to find the registrant’s details. You should compare the details with information at hand, to find out discrepancies.
  2. Use http://whoisology.com website to find other websites linked with the website in question. It helps find link among different websites of the registrant, and thus form an opinion. However, the process won't work if registrant has privacy protection enabled on all the websites.
  3. Use Wayback machine https://archive.org/web/ to find the changes done on the website. Any contradictory change is classic sign of fraudulent website. Similarly, multiple and regular changes indicates the website is fishy. 

Here are some other indicators of website being fraudulent:

  • Contradictory content on the website at different places.
  • Absence of “Terms of use” and “Privacy policy” page on the website. 
  • Limited content, thus probably formed as cover for scam. A genuine website displays complete details, to prove it’s credibility and genuineness. If you find crucial details missing, beware! 
  • Lack of professionalism: Grammar and punctuation errors, using stolen or stock images, fake certificates etc are other indicators of being fraudulent.
  • Company doesn't exist at the place cited on the website or as suggested by the registrant’s data. It's one of the surest sign of fraudulent intention.
  • Website reviews: Website reviews should also be taken into consideration. If feedbacks suggest fake/ fraudulent website, do check the authenticity of the website even more seriously. 

Other Suggestions:

  • Don’t perform financial transaction without meeting the dealer face to face. Similarly, visit the officer of the dealers, before making any payment. 
  • Always remember, if anything appears too good to be true, it probably is! 
  • If the documents are sent by the accused, check for it’s authenticity before paying any amount into the dealer’s account. 
  • Since fraudsters often hide under the garb of company, here is the process to find out genuineness of companies in India.

To find whether a Company is Real or Fraudulent:
Step 1: Visit the website of Ministry of Corporate Affairs, by clicking on the link below: http://www.mca.gov.in/mcafoportal/showCheckCompanyName.do
Step 2: Enter the Company name. Don't try with short forms or half names, rather type full name in the search box.
Step 3: If the company is not registered you shall get an information – Entered Company/ LLP name does not exist. 
Step 4: If the company is registered you will get the following information for the company.
1.    LLPIN /CIN /Form INC-1 Ref No
2.    Company/ LLP Name
3.    State
4.    Incorporation Date
5.    Company Name Status

It helps find the following:
•    Whether the Company is registered or not 
•    State and date of incorporation 
•    Company’s present status

Step 5: Navigate to the link: http://www.mca.gov.in/mcafoportal/viewCompanyMasterData.do 
Step 6: Enter the LLP number, to get the following additional details: 
•    RoC Code
•    Registration Number
•    Company Category
•    Company Sub-category
•    Authorised Capital in Rs 
•    Class of Company
•    Paid up Capital in Rs
•    Number of Members (Applicable in case of company without Share Capital)
•    Complete registered address 
•    Address other than R/o where all or any book of account and papers are maintained
•    Email ID
•    Whether listed or not 
•    ACTIVE Compliance
•    Suspended at stock exchange 
•    Date of last AGM
•    Date of Balance Sheet 
•    Company Status (for e filing)

Alternatives: 
•    Website 1: https://www.instafinancials.com/ 
•    Website 2: https://www.zaubacorp.com/

Zauba Corp:
Using MCA Portal one can gather a lot of information about Companies. But, at Zauba Corp (https://www.zaubacorp.com/) you can get following additional information:
•    Activity of Company
•    Directors of Company 
•    Other Directorships 
•    Trademarks of Company
•    Documents of Company available in public domain 

Also, by creating an account, and paying a small sum of money, you can download all the documents of the Company, which has been submitted with the Registrar of Company. 

Whoisology:
Step 1: Navigate to the link – https://whoisology.com
Step 2: Enter the domain name, without http or https in the search box, and tap enter. 

Sample Search on “Whoisology.com” 
Tapping on the numbers within the boxes besides the Name, Email, Phone etc provides details of other domains having the same corresponding “Registrant details”!

Thus, it helps identify other websites of the registrant. This in turn, can enable identify a pattern between the websites of Registrant.   

The Wayback Machine:
Websites on the internet change regularly. So, to search the previous version of the website, navigate to the link - https://archive.org/web/

Sample Search on “The Wayback Machine”
In case, the previous versions of the website, has already been archived. Then, tapping on a particular date, provides the version of the website on that particular date. This enables to see the previous version of the website. If the website owners change the crucial details like number and mail ID frequently, it’s one of the biggest red flags. 

Other Sources of Information:
Company’s website: 
Most of the Companies have their online presence as well. A careful scrutiny can provide valuable insights like:

  • Additional contact details 
  • Employee details 
  • Focus area of the company 

These parameters are crucial to form first hand opinion. For example, grammatical and punctuation errors, incomplete information, non working contact details and payment in forms which are relatively difficult to track back – are warning signs of a fraudulent company. 

Who Is Lookup:
To find details about a particular domain name:
Step 1: Navigate to the link https://viewdns.info/whois/
Step 2: Enter the domain name in the search box, without http or https. An example, is facebook.com, zaubacorp.com etc.  

If the website registrant, has not purchased WhoIs privacy, you may find the following accurate information about the registrant:
•    Phone Number
•    Email
•    Complete address 

Other Methods:

  • Company’s number and email ID: If there are no ways to contact the company offline, it’s one of the warning indicators, that the business may be fraudulent. 
  • These days, even numbers and address are easy to fake. If possible, visit the official address of the company to find out the details. If the company does not exist at the address shown in the MCA portal database or at the address shown on the website, then it’s one of the surest sign of fake company.  
  • Check website for discrepancies: If the website says one thing at one place, and then contradicts itself at another spot, it’s a red flag that the business is scam, and has been hastily stitched together by un-professionals. 
  • Signs of unprofessionalism: For example, grammatical and punctuation errors, spelling errors, stolen images etc are other indicators of unprofessionalism. 
  • Review the website’s policy pages: Legitimate companies have “Terms of Use” and “Privacy Policy” pages. It the website lacks it, be wary and suspicious. 
  • Look for decent content: Fake and fraudulent websites, generally have limited content and pages, and use lots of fake certificates to trick users. 
  • Using stock images as product, employee, building or logo: Using stock photos as products, logos, employees means the website is trying to portray other’s credentials as theirs. Thus trying to deceive its potential customers. 
  • Modes of payment accepted: If the website only accepts payment through insecure and shady means like cash, Bitcoin etc, then avoid doing business. Otherwise, you won’t be able to get money back if things turn sour, later on. 
  • Registration data for the company’s website: If the registration data reveals, it has been created recently and will expire soon, then most probably the website is a temporary cover for scam. 
  • Check the company’s reviews: It can be searched on internet, with simple Google search or by using various Google advance operators like double quotes, file-type, site etc. Various consumer review platforms may reflect the true opinion of its products and services. 

What if You Already Have Become its Victim?

If you have already been defrauded by these criminals, you should immediately lodge an FIR with the local police station, having jurisdiction over your area or at the nearest district cyber cell/ state cyber cell. 

Based on the facts and circumstances of the case, Section 419 or Section 420 IPC can be slapped on the case. The Sections have been reproduced below. 

Section 419: Punishment for cheating by personation: Whoever cheats by personation shall be punished with imprisonment of either de¬scription for a term which may extend to three years, or with fine, or with both.

Section 420: Cheating and dishonestly inducing delivery of property: Whoever cheats and thereby dishonestly induces the person de¬ceived to deliver any property to any person, or to make, alter or destroy the whole or any part of a valuable security, or anything which is signed or sealed, and which is capable of being converted into a valuable security, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine.

Will Banks Refund Money in Case of Petrol Pump Dealership Scams?
Money refund in case of un-authorized electronic banking transactions is governed by RBI circular dated July 06, 2017. 

RBI Notification:
The bank’s (All scheduled commercial banks, Small finance bank and Payment Banks) liability in case of Unauthorized Electronic Banking Transactions is governed by RBI circular - RBI/2017-18/15, DBR.No.Leg.BC.78/09.07.005/2017-18 dated July 06, 2017. 
The Most Important Aspects of the Circular are as follows:

Limited Liablity of a Customer:
1. Zero Liability of a Customer
A customer’s entitlement to zero liability shall arise where the unauthorized transaction occurs in the following events:

  • Contributory fraud/ negligence/ deficiency on the part of the bank (irrespective of whether or not the transaction is reported by the customer).
  • Third party breach where the deficiency lies neither with the bank nor with the customer but lies elsewhere in the system, and the customer notifies the bank within three working days of receiving the communication from the bank regarding the unauthorized transaction.

2. Limited Liability of a Customer:
A customer shall be liable for the loss occurring due to unauthorized transactions in the following cases:

  • In cases where the loss is due to negligence by a customer, such as where he has shared the payment credentials, the customer will bear the entire loss until he reports the unauthorized transaction to the bank. Any loss occurring after the reporting of the unauthorized transaction shall be borne by the bank.
  • In cases where the responsibility for the Unauthorized electronic banking transaction lies neither with the bank nor with the customer, but lies elsewhere in the system and when there is a delay (of four to seven working days after receiving the communication from the bank) on the part of the customer in notifying the bank of such a transaction, the per transaction liability of the customer shall be limited to the transaction value or the amount mentioned in Table, whichever is lower.

Will get Money Refund in these Frauds?
RBI guideline says - In cases where the loss is due to negligence by a customer, such as where he has shared the payment credentials, the customer will bear the entire loss until he reports the unauthorized transaction to the bank. Any loss occurring after the reporting of the unauthorized transaction shall be borne by the bank.

Therefore, if the victim has willingly transferred money into the fraudster’s account, he will have to bear the entire loss until he reports the unauthorized transaction to the bank. However, any loss occurring after the reporting of the unauthorized transaction shall be borne by the bank concerned.