What is the legal procedure to recover money lost in online fraud?
Legal Procedure to Recover Money Lost in Online Fraud in India: A Complete Guide
Online frauds have become increasingly common with the growing use of digital transactions and online banking. Whether the fraud involves unauthorized transactions, phishing, fake shopping websites, investment scams, or identity theft, the victim of an online fraud has legal remedies available under Indian law to recover the lost money and take criminal action against the fraudsters. This guide explains in detail the complete legal procedure to recover money lost in online fraud in India, along with all essential steps, laws, portals, and FAQs.
What is Online Fraud?
Online fraud includes any act where a person is deceived through digital means (internet, mobile apps, emails, social media, websites, or digital wallets) and is unlawfully deprived of their money, sensitive data, or assets. Common examples are:
- Fake online shopping sites
- Phishing or fake bank emails/messages
- Fraudulent investment websites
- Credit/debit card or UPI frauds
- Fake customer care numbers
- Lottery or job scams
- QR code and screen sharing scams
Legal Provisions Applicable
Several laws deal with online fraud in India:
1. Information Technology Act, 2000
- Section 66C – Punishes identity theft
- Section 66D – Punishes cheating by personation using computer resources
- Section 43 & 66 – Unauthorized access, hacking, data theft
- Penalty includes imprisonment up to 3 years and/or fine
2. Indian Penal Code (IPC)
- Section 420 IPC – Cheating and dishonestly inducing delivery of property
- Section 406 IPC – Criminal breach of trust
- Section 468 IPC – Forgery for cheating
- Section 120B IPC – Criminal conspiracy
3. RBI Guidelines & Banking Ombudsman Scheme
- Protection against unauthorized transactions in banks and digital wallets under RBI circulars
- Banks are liable if the customer reports fraud within a prescribed time
Step-by-Step Legal Procedure to Recover Money Lost in Online Fraud
Step 1: Inform the Bank or Digital Wallet Provider Immediately
- Call your bank or payment service provider’s customer care number immediately.
- Report the unauthorized transaction and request to freeze your account or block the card.
- Request a chargeback or transaction reversal if applicable.
- Provide transaction ID, amount, date, and details of fraud.
Step 2: Register a Complaint on the National Cyber Crime Portal
- Go to: https://cybercrime.gov.in
- Select “Report Other Cybercrime” and fill the complaint form.
- Upload supporting documents like screenshots, transaction ID, payment receipts, chats/emails.
- Once filed, you will get a reference number (acknowledgment).
- You may also call the Cyber Helpline Number 1930 (available 24/7).
Step 3: File an FIR at the Nearest Police Station
- Visit your nearest cybercrime police station or local police station.
- Submit a written complaint with all transaction details and proof of fraud.
- If the police refuse to register your complaint, approach the SP or DCP, or file a complaint under Section 154(3) CrPC.
Step 4: File a Complaint to the Banking Ombudsman (For Bank Frauds)
- If your bank refuses to refund your money, file a complaint with the RBI’s Banking Ombudsman.
- Website: https://cms.rbi.org.in
- Provide complaint details and transaction info.
- Ombudsman will inquire and direct the bank to refund if found at fault.
Step 5: Approach Consumer Commission (If Service Deficiency Involved)
- If fraud occurred due to negligence by an e-commerce platform, wallet provider, or bank, you can file a case for deficiency in service under the Consumer Protection Act, 2019.
- File online at https://edaakhil.nic.in
Step 6: File a Civil Suit for Recovery of Money
- If a known individual or company defrauded you (e.g., an investment scam), you can file a civil recovery suit in court.
- Serve a legal notice demanding refund within 15–30 days.
- If no response, file a Summary Suit under Order 37 CPC (for faster disposal).
- This suit must be filed in a court having jurisdiction over the location of transaction or residence of the defendant.
Documents Required
- Bank statements and transaction slips
- Screenshot of fraudulent transaction or website
- Complaint acknowledgment from cybercrime portal
- Police FIR or complaint copy
- Email/chat/WhatsApp exchanges with the fraudster or service provider
- Legal notice (in case of civil suit)
Time is Crucial
Acting within 24 to 48 hours of the transaction significantly increases the chances of recovering your money, especially in UPI or card-based frauds. Banks can block or reverse transactions before funds are moved further.
FAQs
Q1. Can I get my money back if I was cheated online?
Yes, if you report the incident promptly to the bank and cybercrime authorities, you can recover your money. Civil recovery is also possible through a court case.
Q2. What is the first thing I should do after being cheated online?
Immediately inform your bank to block the card or transaction and then file a complaint on the cybercrime portal https://cybercrime.gov.in.
Q3. What is the time limit to report online banking fraud to the bank?
As per RBI guidelines, the fraud should ideally be reported within three days to avoid any liability. Delay can reduce the chances of recovery.
Q4. Can I file both criminal and civil cases for online fraud?
Yes, you can lodge a criminal case to punish the offender and simultaneously file a civil case to recover your lost money.
Q5. How long does it take to get money back after filing a complaint?
It varies:
- Bank reversal – 7 to 10 working days
- Ombudsman complaint – 30 to 60 days
- Consumer Court – 3 to 6 months
- Civil Suit – May take longer, unless filed as a summary suit
Q6. Can I file a complaint if the fraud was committed through a fake investment website?
Yes, you can lodge a complaint under cybercrime laws and also approach the Economic Offences Wing (EOW) of police for investment frauds.
Q7. Is it necessary to hire a lawyer?
Hiring a lawyer is advisable for sending legal notice, filing civil suit, or following up on police inaction. For initial complaints, you can file them yourself.
Conclusion
If you’ve lost money due to an online fraud, don’t panic. Act quickly and follow the legal steps to increase the chance of recovery. Begin by reporting to your bank, file a complaint at https://cybercrime.gov.in, and lodge an FIR. Depending on the case, you can also approach the RBI Ombudsman, Consumer Commission, or Civil Court. With timely legal action, many victims are able to recover their money and bring fraudsters to justice.
Important: Kindly Refer New Corresponding Sections of Bharatiya Nyaya Sanhita 2023, (BNS); Bharatiya Nagarik Suraksha Sanhita 2023, (BNSS); & Bharatiya Sakshya Adhiniyam 2023, (BSA) for IPC; CrPC & IEA used in the article.
Disclaimer: This information is intended for general guidance only and does not constitute legal advice. Please consult with a qualified lawyer for personalized advice specific to your situation.
Advocate J.S. Rohilla (Civil & Criminal Lawyer in Indore)
Contact: 88271 22304
