Rs 7,647 Crore Blocked Since April 2021, But Only 2% Of Money Lost In Cyber Fraud Recovered: Govt

Despite blocking Rs 7,647 crore from reaching cybercriminals, only Rs 167 crore – around 2.18 percent of the Rs 52,969 crore reported stolen in online fraud between April 2021 and November 2025 has been

restored to victims, as per a government document.

In a move aimed at balancing swift action against cyber fraud with safeguards for victims, the Centre has asked law enforcement agencies to ensure that only genuine complaints are escalated for financial intervention to avoid unwarranted freezing of bank accounts and resulting hardships.

The direction is part of an operating procedure governing the custody and recovery of money, along with grievance redress, under the National Cybercrime Reporting Portal (NCRP) and Citizen Financial Cyber Fraud Reporting and Management System (CFCFRMS).

According to the government document accessed by News18, the system has helped stop large sums from reaching fraudsters, but the money recovered remains limited. Between April 2021 and November 2025, Rs 7,647 crore was prevented from reaching criminals out of Rs 52,969 crore reported stolen, but only Rs 167 crore was recovered, which is about 2.18 percent.

FOCUS ON GENUINE CASES

Officials said the intent is to prevent legitimate customers from being swept up in cybercrime controls due to mistaken identity, disputed transactions, or insufficient verification.

Such actions can disrupt daily life, salary withdrawals, business operations, and essential payments when accounts are frozen without clear linkage to a fraud chain. Hence, the standard operating procedure (SOP) stresses on tighter scrutiny before complaints are pushed into the financial fraud response ecosystem, so that “put-on-hold”, suspension of digital banking facilities, and seizure-related steps are proportionately used and with accountability.

FASTER ‘PUT-ON-HOLD’ VIA BANK-PORTAL INTEGRATION

As part of strengthening real-time response to cyber-enabled financial fraud, banks will be pushed to integrate APIs with the National Cybercrime Reporting Portal (NCRP), enabling quicker “put-on-hold” action on suspected proceeds of fraud and smoother coordination with police and financial intermediaries.

This is expected to reduce delays that often allow money to move across multiple accounts within minutes, complicating recovery. The Centre’s approach is to tighten the chain of communication between police, banks, payment operators, merchants, and other entities so that suspicious funds can be ring-fenced early.

GRIEVANCE REDRESS, TIMELINES TO REMOVE WRONGFUL HOLDS

The SOP outlines a structured grievance redress mechanism, particularly for cases where account holders claim funds were wrongly held or accounts were frozen without a valid connection to the suspected fraud trail.

Account holders can approach banks to raise grievances, and investigating officers are expected to verify claims – preferably through video conferencing – to avoid repeated physical visits and delays. If grievances are not addressed within prescribed timelines, escalation mechanisms up to district and state-level grievance officers are laid down to ensure accountability and faster relief.

BRIDGING GAP BETWEEN BLOCKING FRAUD & RECOVERY

While the government’s system has shown success in preventing fraudulent proceeds from being siphoned off, the SOP signals a policy push to improve recovery to victims by streamlining legal and operational steps for interim custody and funds release.

Officials said the aim is to reduce avoidable litigation and procedural bottlenecks so that when victims’ funds are clearly traced and held, they can be returned faster, especially in single-victim cases, while also ensuring due process for suspected beneficiaries and avoiding indiscriminate freezes.

With online scams expanding across UPI, internet banking, e-commerce, wallets, and impersonation fraud, the central government’s tighter escalation rule and API-led coordination are expected to serve a dual purpose: hit cybercriminals faster, and protect innocent citizens from disruption caused by mistaken freezes.