Why the First 6 Hours are Crucial to Report Fraud

The idea behind this is similar to you reporting that your wallet or jewellery got lost. The sooner you tell someone, there is a higher chance of retrieval, before the money is spent, the object is sold or the thief disappears.

Similarly, in the occurrence of fraud – be it a credit card fraud, being trapped in a MLM scam, or a loan scam – the first six hours are critical. The authorities (bank, police or law enforcement, payment companies, etc.) will have a higher chance of stopping further damage from happening. They may even trace the scammer.

● Cybercriminals work at an incredible speed. This is because digital money can be transferred and moved about very easily. If you report a fraud quickly, the banks may have the ability to freeze the transaction before the money gets received or spent by anyone else.
● Delaying the reporting also gives the scammers more time. They can execute methods that will make tracing and investigating more difficult. For example, in many cases, after a scammer gets money from the victim or accesses the victim’s account, there is not just one single transfer made. Instead, they deploy a method of layering their transactions. This means they split the money and transfer it to several accounts (mule accounts), which then is withdrawn as cash, so that it becomes comparatively harder to trace.
● Evidence needs to be collected immediately. Too long of a delay and it becomes more difficult to retrieve. This not only includes transaction proof and IP addresses, but also email and chat history, login information, call recordings etc. Even the transferring of money when it’s digital is easier to trace, before it is withdrawn in cash or converted to hard-to-trace assets.

To understand why reporting as soon as possible is critical, let us take an example of a fake investment scam.

If the fraud is reported immediately, there is less time for the scammer to disappear- there would be higher chances that the website or phone number used for the scam is still available and so are the bank accounts to which the money transfer can be traced. Official authorities can also be made aware in the correct time so that alerts can be issued and actions by the relevant institutions or banks can be taken.

The main focus is to prevent further damage from happening and to trace the person who committed the fraud, hopefully retrieving the money lost in the process. Banks have the power to put on hold suspicious transactions and block your account so that further transactions don’t take place. If it’s possible, then the receiving account (as long as it’s within legal limits and enough information is there) can also be frozen. Passwords can be reset, cards can be blocked and digital banking can be temporarily disabled to stop more misuse. Banks also have a networking system to coordinate with other banks to issue alerts.

You are also more likely to get a chance for a refund if you report within the first 1-3 days. According to the guidelines by the Reserve Bank of India, this limits your liability. You have to report any unauthorised digital banking transaction within the first 3 working days, leading to zero liability. You don’t lose any money and get a full refund (depending on the context).

So, it is crucial to report fraud as soon as possible, within the first 6 hours. You can do this by contacting the National Cyber Crime Helpline, through the portal or number, and by reporting the issue with your bank, so that the relevant steps can be taken. Remember, quick reporting can stop a small financial loss from turning into a much bigger one.