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CBI investigating an internal fraud in Paytm involving refund to customers despite delivery of goods

one97 communications / payments bank / paytm / alibaba
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While ecommerce firms are often under crosshairs for wrongful delivery of items, there are several cases of customers duping these firms with the help of company’s own employees by taking goods, and still asking for a refund. And they do get that refund. These malpractices is increasing, and Paytm is taking a stern action against it.

The Alibaba-backed digital payments and ecommerce behemoth has now asked country’s premier investigation agency — CBI — to look into a case of internal fraud (via IndiaToday). The company believes, that a certain section of its workforce is aligning with customers and helping them get full refunds for products which have actually been safely delivered.

According to the FIR filed,

The refunds happened through the illegal use of the ids of four of its employees. Twenty-six orders were booked by a group of people to the tune of Rs 1.62 lakh. It has named six suspects – Rajesh Kumar, Sumit Gupta, Ashu Singh, Tilu Tilu and Raju Kumar who know each other. All the orders were booked from Mansarover Garden. The customers illegally appropriated the money refunded.

The Central Bureau of Investigation had filed a case of cheating on July 30th, upon receiving this complaint from Paytm. The company had listed 26 cases of internal fraud, wherein a refund was claimed and processed even after the successful delivery of goods was made.

The Case

The technical analysis of the e-commerce service provider states that this cannot happen without involvement and knowledge of its employees.

the FIR based on the complaint says.

Paytm’s — or largely any ecommerce firm’s — policies state that a refund or an exchange is processed only when a defective product is delivered. These companies then order a reverse pick-up from customers and send the defective product back to the merchant. Upon receipt of the product, the merchant confirms to the ecommerce brand it is connected to, who then process a refund.

In this case of fraud though, consumers had been successfully delivered the product, and still got a full refund of the same. According to Paytm, customers conspired with internal employees, and used these employees’ internal IDs to pull this off. They all took delivery of the products at a common address and faked entires with the help of employees.

The lodged FIR has accused those involved, under sections alleging cheating by usage of forged documents, falsification of accounts and breach of trust along with provisions of the Information and Technology Act, 2005.

We’ve mailed Paytm for more info on this. Will update the story when we receive the input.

Editor-at-large and co-founder at The Tech Portal. He is a tech enthusiast with interests in new-age technology fields like Ai, Machine Learning, AR/VR, Outer Space and related stuff. Drop him a mail anytime, very reachable.

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