Topic: Solution for Bank Account frozen by Cyber Police due to P2P Trading (India) (Read 1871 times)

https://pib.gov.in/PressReleasePage.aspx?PRID=1991372

"Financial Intelligence Unit India (FIU IND) issues compliance Show Cause Notices to nine offshore Virtual Digital Assets Service Providers (VDA SPs)
FIU IND writes to Ministry of Electronics and Information Technology to block URLs of the nine entities operating illegally without complying with the provisions of PML Act in India
Posted On: 28 DEC 2023 8:56PM by PIB Delhi
Virtual Digital Assets Service Providers (VDA SPs) were brought into the ambit of Anti Money Laundering/Counter Financing of Terrorism (AML-CFT) framework under the provisions of the Prevention of Money Laundering Act (PML) Act, 2002 in March 2023.

As part of compliance action against the offshore entities, Financial Intelligence Unit India (FIU IND) has issued compliance Show Cause Notices to following nine offshore Virtual Digital Assets Service Providers (VDA SPs) under Section 13 of the Prevention of Money Laundering Act, 2002 (PMLA)."

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Websites of famous crypto exchanges will be blocked in India for violating laws, but VPN always works.

The bank is obligated to provide you with a copy as it's needed to prepare your defense. They cannot deny it on any ground. You have the right to defend yourself.

First, try to contact the Nodal Officer of the Bank via email and ask them to send you a copy of the notice.

You can get email details by executing a simple Google search. It's also available on the bank website. You can even ask the bank employees to hand you the Nodal Officer's email.

Once you contact the Nodal officer and get a reply, note down the reference number.

Wait for 30 days to get a resolution. If they don't comply with your request, lodge a complaint with RBI Ombudsman.

You can do it online here:
https://rbi.org.in/Scripts/Complaints.aspx

In case you don't get a response from RBI, then try lodging a complaint at the Public Grievance portal here:
https://pgportal.gov.in/

The notice copy is vital for your information, and you should do all you can to get it from the bank.

According to the law, money cannot be frozen forever, because each criminal case has its own time frame for investigation and transfer to court.
Don’t rush to hire a lawyer, try to find the authorities that control the bank’s activities and ask for a free consultation there.
Most likely, your account will be blocked until the case is closed, but you can influence this to speed up the closure of this case.

thank you so much for the detailed information. Recently, My bank account was frozen by the bank, and bank employees haven't given me the proper resolution. When I asked them for the acknowledgment letter, they started saying - they were not allowed to give that to me.

I called the cybercrime customer care number and they provided me with the investigation officer's number but the investigation officer never picked up my phone, no response to my messages. I don't have much information and I've never been into something like this. I mean I felt so helpless until I found this thread. Thank you so much again for the help.

I live in Ludhiana, Punjab and The victim is from Nagpur as far as I know from customer care support.  I don't know what needs to be done in that case. If you can help me with where to hire the lawyer, that would be really appreciated.

Thanks, I have read the article. Lawyers want to achieve a more complex procedure for blocking client funds at the bank, but this will also help fraudsters avoid blocking bank accounts.
I don’t know how this lawsuit will end, P2P exchanges also have tax risks, and it’s not clear how your tax authority will calculate the profit from the transaction. The tax authorities will have the right to request documents from you with the seal of the exchange for each P2P exchange. In such a business, problems cannot be avoided; it is easier to trade on decentralized exchanges.

You can read it here:
https://prnt.sc/TQF3FQonph3x

I could not read the entire article, because it is paid, but all banks work according to the same laws. If the police demand to block an account because a crime has occurred, then this is legal. Banks can block accounts even without statements from the police, but only because you have a lot of P2P transfers and your activity looks like a commercial one.

I am sure that in your agreement with the bank it is written that you cannot carry out business activities on the account of an individual. And in some European banks, before concluding an agreement, you sign a document that you will not carry out transactions with cryptocurrencies.

The only way to trade is to become a qualified investor, obtain the necessary permits and register as an entrepreneur with a bank.
An example with trading on a P2P site, and then paying income tax from an individual at the end of the year next year will not be legal and there will always be problems.

I am able to unfreeze 3 bank accounts usual way contact lawyer negotiate with police pay something

Police  also well aware we are not involved in any activity in fact few cases they are also part of the scam

Its a big business going on in India right now. Hope any one file some PIL some case filed in kerala High court and I am following it with lawyer

https://www.livelaw.in/high-court/all-high-courts/kerala-high-court-unilateral-freezing-bank-accounts-nccrp-portal-complaints-cyber-crime-226886

3 more cases pending 2 of them reached final stage of negotiation have to approach some top officer in ladder

believe its much bigger than we thought . They ae freezing 60-70 accounts in a single complaint and most of them are innocents

CRPC 102 given them power and they misuse . Any one ready to file PIL I am ready to be part of it

It is safe to trade on the exchange when you work in accordance with the laws of the country and pay taxes. Exchanges very often block traders' accounts and request a lot of documents on the origin of funds and tax returns. If you are not ready for such consequences, and do not know how to act, then this is also dangerous.

Only spot trading on Indian Exchanges is the safest legal way. They will deduct the necessary TDS on trades. Also, since funds come from their account, you don't need to worry. There is no safe way to deal with P2P. The biggest problem being you never know about the identity of the other person, and the second is the TDS deduction.

On a side note, P2P is the worst way trying to clear your debt, as you may end up losing even more money. Crypto is high-risk and must not be taken for granted.

If the police don't want to talk to you, that's fine. So the police have no questions for you. In the case of a criminal case, an explanation will be taken from you.You need to figure out how the account blocking procedure works and what needs to be done to unlock the account.
You need to find friends in the police and in the bank who will help you. Lawyers will cost more. You need a lawyer when there is a criminal case against you.

I would be more than happy to contact and cooperate but how when they themselves are uncooperative. The Banks don't give any info and just say to contact Cops and they provide reception contact details of cops. The cops don't cooperate as well. They just block the account and don't communicate. I still don't know who the IO for this complaint is. How do I contact them? Any suggestions?

I am doing nothing illegal and I intend to pay taxes. I only started last month but I will pay taxes after the financial year ends.

It is much more difficult to communicate with banks and it is necessary to assess the risks of blocking. It is easier to communicate with the police, but you must be registered as an entrepreneur and pay taxes. If you prove to the police that you are engaged in legal activities, then they will only be happy not to start a criminal case and recommend that all participants go to civil court
If you want to continue to engage in P2P exchanges, then you need to learn how to communicate with the police and banks.

Thanks for your instructions & responding. I was sick for few days and didn't check the forum. I have now sent an email to Nodal officers on Monday.

I contacted her only because I couldn't get any other contact info to reach out to. Banks aren't sharing any info except the complaint number. I have lodged a complaint with the nodal officers for my banks per your instruction but no response yet. Will wait & See.

Is there any way to avoid these scams and still make some profit on P2P Trades? Everything I earn goes into loans, mostly from relatives, that my father took and lost in business. With P2P I had some real hope of clearing that debt in a year and actually save something. But now all hope is gone.

Pls suggest any way to avoid such bank freezes? I am thinking getting a merchant account of Paytm or PhonePe. Because I have observed from the statement shared by girl who transferred me that they seem to ignore merchant payments. The girl who paid me got 5K on 16th May. From 16th May to 17th  May She made multiple transactions of 150 (grocery), 2500 (jewellery) & 25000 (other user). After that, she paid me 17K. Still, cops skipped all 3 accounts and blocked only mine. Maybe the cops will see that the payment happened to a merchant account, assume it's for some purchase and not freeze such accounts? Any help pls.

Who in India initiates a bank account freeze?
Does the victim of fraud have to file a complaint with the police, and then the police go to the bank to block the account, or does the victim go to the bank with a complaint?
The police should by law have a time limit for considering such applications. In order not to have bad statistics, criminal cases are not initiated if the amount of damage is small and the prosecutor sends a notification to everyone that the investigation is over and no criminal case has been initiated.Fraudsters take advantage of this and deceive for small amounts.

Contacting the victim of the scam is not a good idea. I understand that since the amount was small, you may have decided to take such a step.

Before you decide to settle with anyone, first make sure that you have the freeze notice copy from the bank.

If the bank is not cooperating, you can lodge a complaint with the bank's nodal officer.

You can get the nodal officer's email via the bank's official website or through Google.

e.g., https://sbi.co.in/documents/53471/91871/NODAL+OFFICER+LIST.pdf

Once you have sent a complaint, you will get a reference number. Keep that handy.

If your complaint isn't resolved within 30 days, then you can use the reference number to lodge a complaint with the RBI Ombudsman here:
https://cms.rbi.org.in/cms/indexpage.html#eng

The bank is legally bound to give you the notice copy since it's a vital document to prepare your defense. Article 21 of the Constitution of India guarantees this right.

If there is no instruction for a freeze, then you can lodge a complaint against the bank with RBI Ombudsman for an illegal freeze. In any other case, you will be required to take the help of a lawyer.

This is a very old scam. The scammer finds gullible people in telegram who want to buy cryptocurrency.
This is a very old scam.
The fraudster finds out the purchase amount from the victim from the telegram, then makes a deal with you for this amount.
The victim from the telegram transfers money to your details, and the scammer receives your cryptocurrency and disappears.
The victim from the telegrams writes a statement about the deception to the police on you.
There is no defense against this scam. Some services ask for a minimum payment to verify the card, but the scammer can convince the victim to do this too.

In Russia and Europe, the police are aware of such fraud, but since the fraudster is unknown, criminal cases are closed. But your bank account may be blocked for a long time.
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You need to take statements from the crypto exchange with P2P exchange logs and explain to your police and bank what happened.

Hi OP,

I signed up after reading your post. I didn't know about this scam and was doing P2P trading to make some side income. To overcome the UPI limit of 10 payments per day, I frequently transferred money between my accounts. As a result, all 4 of my Bank accounts have been frozen because of a single payment I received. 55000 INR stuck.

From the Bank, I was able to only get the complaint number, complainant details (Name, Number & Email), and the contact details of Delhi West Cyber Crime Branch. They aren't giving any info about which section it is under.

From what I gathered with the complainaint, Richa Gupta, she claims to be a victim of scam from telegram where she was informed to pay 5K to someone named Yashaswini and 22K to someone Tapas Mohato. Now, Yashaswini later purchased crypto from me and paid me 17K. As a result, my accounts got blocked. Yashaswini claims her account is also blocked.

Since this is mainly due to the chain of 5K payment, me & Yashaswini have suggested to Richa that we will pay 5K to her as long as she conveys the same to the cybercrime branch and they remove all the freezes. We didn't ask her to remove the complaint because they need to investigate that 22K payment. We clearly said we don't know about the scam but making this payment to get our money released. But she isn't cooperating and wants her 27K back.

I called the cybercrime team and they aren't saying anything except that I will have to wait till investigation is complete. That could take months and this was my entire salary.

What can I do next? How can I force Banks to give me full report including section numbers and instructions received? What should I say to the cybercrime team to get this resolved?

I saw the venn diagram but given that the lawyers themselves will ask high fees, I am reluctant about it. Any help pls.

Have you obtained the notice copy?

Which state police you got this case because I am suffering same thing with Maharashtra.if it's same in your case reply to me.

Are you afraid that the police will "seize any property during the investigation" according to 102 of the Criminal Code?

If this is a criminal case, then you should be subpoenaed to the police to testify. Even if, according to your law, the police are not supposed to notify you, the bank must give you an answer about the reason for blocking your bank account.

I'd suggest you to not give any private details to the public like this. Scammers can use this to scam you by offering fake assistance for example. Just put your worries here without giving any personal info such as your name, location, etc. You can also seek help by posting on the Indian local boards if you want to (other than following what OP suggested above). Here is the link if you don't know which board I'm referring to[1].

[1] https://bitcointalk.org/index.php?board=89.0

First, you need to stay calm. Just because the word FIR has been mentioned does not mean something terrible has happened. The bank needs to give you the Notice copy. If they are not co-operating you should contact your banks nodal officer via email. The email is usually mentioned on the official website of the bank. If you still don't get it then google it.

In case the nodal officer does not give you a copy in 30 days, you can lodge a complaint with RBI Ombudsman here:
https://cms.rbi.org.in/cms/indexpage.html#eng

Once you get the copy follow the instructions in the post to get your account defreezed.

You need to be patient and relaxed for good results.

I got in a similar situation both my own and my sis accounts are frozen/held resp. Now, I don't even know what to do. I talked to the bank manager and gave him all the proofs but he didn't provide me the order copy I somehow managed to see section 92/102 and there was something written like FIR...

Can you kindly help me please, I can't send you a dm bcoz of being a newbie but can you please dm me on WhatsApp- 7086664845


I'm really tense as everything I had is blocked now.

Kindly help me, sir, if possible please dm me as I'm terrified and don't know what to do. And as I saw the word FIR I'm really sacred to my bone.

Do you have different tax laws in each state? In my country, for example, the activity of a lawyer is licensed and controlled by the Bar Association, in which he will then work. If you need help in another region, the board will find a lawyer.
At the first stage, as a rule, telephone conversations or correspondence via mail are required. Any lawyer can do this, the main thing is that he has experience in such cases.
It is he who should contact the bank, sort out the problem and offer options.

Its always better to hire a lawyer in the same state from where the complaint came from.

Hi Sir,

My PayTM account was blocked due to WestBengal Cyber Cell for the similar reason in this thread. I am from TamilNadu.
When you say "Contact Local Lawyer", do you mean I should contact a lawyer in TN or lawyer in West Bengal?

I have also PM'd you regarding the same.

Thank you in advance.

There is no need to be naive about such situations, although I do not know how common this practice is in your countries. Because in my country such procedures last from one to several months. When I was an inexperienced user, they also blocked my bank account and I also corresponded with the bank for 4 or 5 weeks, but even then I had a separate bank account opened for cryptocurrencies.
But I had a small amount of money blocked. But I had acquaintances who were blocked by a bank with a large amount of money. Then the bank transferred the data to the tax office.
These people went to the tax office and thought that they had nothing to worry about, they said too much and fines were issued to them. Although if they were not naive and came with a lawyer, they would not have received fines.
Therefore, think what you are saying, your initial testimony can always later be used to fine you or bring you to criminal liability. Therefore, if you are weak in laws, first consult a lawyer, and do not be a naive person.
I'll tell you the experience in my country. In Russia, even if you are innocent and have been treated unfairly, civil servants and bank employees will still look at you as guilty. If the reason is due to an obvious error, then they will quickly help you, but not a fact. And if the situation is ambiguous, then you will prove your case for a long time.
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I wrote many words. Maybe there is really a trifle, but never be naive(C).

If you haven't done anything wrong you don't have to worry. Just follow the instructions in the thread and you can get your account defreezed.

I wrote many times that for cryptocurrencies and p2p exchanges, you need to open separate accounts in other banks, and not engage in this activity on the main cards where you receive wages or benefits. But you still need a wholesale lawyer to communicate with the bank if you have a large amount blocked.
I don't know your situation. If I were you, I would find out from the bank what they need on my own. If they started asking me questions, I would say that I don’t understand anything about it, so I’ll come tomorrow with my lawyer and give all the answers. If this is possible in your country, then this is a good option.

I am not done anything, illegal bro. I am a p2 p trader.
It kind of chain block of one scammer or fraudster money distributed to many accounts every account gets blocked

If 6 of your accounts are frozen, then you or another person did something bad with your accounts. In my country, they usually ban an account in only one bank. You need to find a good lawyer in your city to communicate with the bank handler. Or is it normal practice in your country to block so many accounts at once?

6 of my accounts frozen only I have case officer details.
I have no idea whats hell is this really

Sir I have shared my number in DM. I cant send more message to you since its says limit on newbie contact me in wapp please

I think that the most important thing is to find out the reason for the blocking. Because if the user's wallets become participants in a fraudulent scheme, then he will need legal assistance in order to return his funds. And such cases can last 6-12 months, which will require large expenses for lawyers.

Please note the Police only has the power to freeze the accounts. They do not have the power to reverse the money. Such reversals can only be ordered by a Court of Law.

Read this
https://news.russia.postsen.com/business/183147.html

"Separately, the exchange team shared a list of the most common reasons for blocking accounts:

communication with a scammer;
potential association with a sanctioned person or entity, residence or travel to a sanctioned jurisdiction;
violation of the Platform Terms of Use;
incomplete provision of documents for the purposes KYC or AML;
established connection of assets with hacking or fraud;
suspicion that you are a hacker or other malicious user;
blocking at the request of law enforcement agencies."

You can be blocked for any reason and not allowed to dispose of funds for a long time.

did anyone else get there problem fixed

There are a lot of accounts registered on binance for other people's data. Fraudsters are using this exchange to cash out and you are at great risk when doing P2P trading with your bank card. To do this, you need to use a separate bank and a separate bank card and do not use your bank card for salary. If you do not understand this, then this will be the first lesson for you.
I do not know the laws of your country, but before trading with your bank cards, it is better to ask for advice from experienced users in your country on forums or social media communities.
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In my country, banks do not explain anything about the reasons for blocking cards and sometimes it is easier to close an account, accept the loss and open a new account in 6-12 months and not make mistakes in future. If the amount of money is large, then contact your local lawyer.

My two accounts with SBI and RBL have been set to zero and negative balances due to P2P trading on Binance, and my credit card has also been blocked. The bank has only provided me with the contact information for the cyber cell in different states.

Another bank account that I have does not have any available balance and I am not sure how much has been blocked.

Additionally, my RBL credit card has also been blocked.

need help?

Please enable your DM's.

Sorry I haven't received any messages yet.

Please Check your Inbox. I got a Debit Freeze Cyber Complaint.

Can you also DM me? I need your help with this

Dear OP,

My account got debit frozen recently and around Rs. 10 lakh has been stuck in it. The cases are from different police stations around the country. Please help me. All these police are expecting money from me and its a loan amount that i have taken. I have genuinely traded on binance exchange and i have all the records of my trades. They have also lien marked close to 5.64 lakh out of the 10 lakh. Is there anyway i can get in touch with you personally or over phone for a solution. I'm really depressed due to this.

Please stay on topic. The RBI governor's statement has nothing to do with a freeze.

https://www.reuters.com/world/india/india-cenbank-chief-says-next-financial-crisis-will-come-private-2022-12-21/
"MUMBAI, Dec 21 (Reuters) - India's central bank chief on Wednesday warned that the next financial crisis will come from private cryptocurrencies adding that he still holds the view that cryptocurrencies should be prohibited.
Reserve Bank of India governor Shaktikanta Das also added that cryptocurrencies have no underlying value and pose risks for macroeconomic and financial stability."

I have replied to you via DM.

Hi sir,
  I am praneeth my bank freezes by account due to intimation by cyber police for a transaction which i did in p2p from binance, and when i went to near by cyber police station with the CFCFRMS(filed by victim who loss money) given by bank there are saying i need to got the area where the complainant is filed but its impossible to me to go there is far ways from my state and my blank blocked my money of 45000rs and my bank is in negative balance, actually i done a p2p transaction of 2 lakhs in which there are saying 45000 rs is a fraud transaction, please need a suggestion.

I do not intend to go off-topic. Please note that this thread offers a solution for people who have their bank accounts frozen despite being innocent.
Kindly keep the discussions on point. You may create a separate thread to discuss your topic. Thank You.

But Bank can trace the person easier if its withdrawn instead of spending right?

Even if they use ATM still the banking system has security camera and all other data which can let the victim to know about the identity of person who is involved in the scam.

If its withdrawn from banks then it becomes difficult to get it back.

Okay, let's say people got their money back if they took immediate actions like complaining to police, the trading platform etc but even if the money has been withdrawn by the scammer still they have the details to trace where the money went so if someone didn't complaint in the right time also got chances right?

Many have got their money back. It depends on how quickly you complain about the incident. If you're late, the money will disappear.

Recovered or traced? Don't take reference from media outlets they just misinterpret the statements from the actual reality for their own hype. And also any individuals got their money into their bank account?

If yes then the department done excellent job while on majority of cases the results will never be achieved.

Sorry for the late reply, but the Police have successfully recovered stolen money in numerous circumstances. They should never be underestimated. The success rate depends on how quickly you report the fraud.

No offense but most of the time online scams and their funds will never taken back that is why its better to be aware before losing. Probably the law says like that but we never know what happens in reality and actually in India there is no transparency so expecting the fraudsters to get caught and return your money is just waste of time.

Please note the paragraph about the mobile phone is for extreme cases where custodial interrogation takes place. In most cases it wont goto such extreme.
In India Ministry of Home Affairs, Police and the Courts handle issues related with crypto associated fraud.

May I recommend to everyone reading the above (well written) notice that they should also NEVER take part in transactions on social media platforms where you are the seller, except in cases where you know  the receipents well (for example, from this forum, and you are paying them for work).

That will save you from a lot of legal trouble later as you have no idea if they are shady or what they are even doing at the other side of the screen.




Can someone from india tell me if the institution handling that gets a lot of such complaints, thereby getting overwhelmed with them and thus some people do not get replies?

If you're not getting replies from a complaint body, then obviously, it won't help you much! (the Better Business Buerau immediately comes to mind as they have no actual power over companies to change their ethics).


It should be mentioned that most of the time, these demands to see your mobile phone or email will usually not mount into any evidence for or against you, particularly if there is hardly any data at all inside it about the crime.

Well done. All the best for your future.

Here is an image for everyone's reference:
https://i.imgur.com/5J3DI8p.png

Thank you for sharing your knowledge, I got the releasing order from the court under sec 457 crpc. for me the case was registered in different state, and I wasted 6 moths just because i didn't know about the procedure. and local lawyers have less knowledge about this crypto related issue. But this post helped a lot and gave me more idea about how our justice system works. god bless you

Thank you! I will follow the suggested approach, hope it works out well.

Thanks again!

I have replied earlier. My best wishes for a speedy solution.

I voted for Fantom India. As a monetary democracy.

Soeh. I get paid for my votes.

I am facing the same issue. My account with HDFC Bank is in debit freeze state for more than 6 months now.

@HypeManBoosted I have sent you PM, let me know if you could suggest next steps

The freeze notice has to be under Section 91 or Section 102 CrpC. This notice will be available with the bank. Did you check under which section it was sent?

I have enabled personal messages. You can contact me via PM.

AFAIK, cryptocurrencies and cryptocurrency trading in any form is completely legal now but the banks are against it but it was overuled by the SC judgement now many exchanges even working there and depositing fiat from banks. So the only issue is not related with the cryptocurrency it maybe something related to the source of funds and it will take time to move this case legally and even for years in country like India if I am not wrong.

Hii,
Main FIR is under section 154.
Anymore details needed sir ?
Im unable to send you a direct message sir, as you have disabled messages from newbies on this website.

Hello Prem. Thank you for sharing the details.

First of all, you need to check the freeze order copy for specific instructions to freeze your account. The second thing you need to check is if the freeze notice is under Section 91 or 102. You will find this information at the top of the notice. Has any FIR been registered in this matter?

Once you provide this information I will guide you with a future course of action. You can also send me a private message if you do not wish to share details publicly.

I am from Pakistan and we also have the same situation where the government authorities are willing to arrest people who are big dealers in crypto P2P. Is India also facing the same issue and crypto is illegal in India too 

I wonder when our governments will understand that crypto is the need of the time and banning will not help anyone. Regulating crypto will not only help people and the governments but the frauds could be minimized too.

Hello sir,

I'm prem. my bank acc got freezed on nov 30rth, 2021. Freeze came from mumbai police station. And the freeze came for doing p2p transactions on binance. I have got the complaint letter from my bank. It is mentioned in the letter as follows.
"Tulinj police station had registered C r no 1163/21, u/s 420,34 of IPC r/w 66 (c)(d) of information technology act 2000 dt 18/09/2021". I called the resp officer and he asked me to come to the station to give my statement.
i have gone to the tulinj station to give my statement on 27th dec and gave my statement. Its been nearly 1.5 month from the freeze date. when i called the officer recently , he said he cannot do anything and we need to wait till main culprit is found . And i didnt get any direct complaint from anyone to freeze my account , its just chain freeze kind. Officer said Some fraudsters using scam money to buy crypto from you , so thats y money to came to your account and got freezed.
Can you please guide me on what to do next and how to get my acc unfreezed?

If your bank repeatedly claims that they have powers to freeze your account under section 91 then show them the following:

Mohd Rizwan Ansari vs. State of Uttarakhand & Others. Writ Petition (M/S) No. 699 of 2021

In paragraphs 10 & 11 the Hon'ble Uttarakhand High Court stated:

"10. In view of the aforesaid legal position, this Court has no hesitation in holding that the direction issued by the Investigating Officer under Section 91 of Cr.P.C. to the Branch Managers to freeze the Bank Accounts of the petitioner, is not sustainable in the eyes of law.

11. In such view of the matter,  the Banks are not bound to comply with such direction as regards freezing of Saving Bank Accounts of the petitioner. "

The bank cannot go against the HC's decision. Tell them you will be sending them a show-cause notice soon and will drag them to court and sue for damages for violating your personal liberty under Article 21 of the constitution.

You can download a copy of the above-mentioned judgment here:
https://app.box.com/s/f119n0cbsf7vorgnx1hv3wn61eauqpqm

Neither the bank nor the police have any power to freeze your account under Section-91 CrPC. It's illegal and contrary to law. Obtain a copy of the notice from the bank. Read thoroughly to check if there is any instruction for freezing your account or if the notice is general in nature.

Hi, my account got frozen by axis due to noticefrom cyber cell. This was because of p2p trade on wazirx.
 bank got 2 notice. both are under crpc 91. Axis bank is contesting they have power under crpc 91 to freeze!

Request your advice

Banks have no power to freeze an account without prior authorization from a Government Authority. If they suspect anything fraudulent then they can report it to the FIU or ask the customer for justification and for fresh KYC. An arbitrary freeze by the bank will be considered illegal and a direct violation of the person's right to life under article 21 of the constitution. There are no rules framed by the RBI that allow a bank to put an indefinite freeze on your account.

Thank you for this article, which is full of important legal information that you should know in case anyone is exposed to such incidents.
But I would like to point out the exact point you mentioned:
 "Do not trade in P2P with unknown people"
This is absolutely true because it carries a high risk, not only can you buy money from fraudulent people who use you to launder their money, but also there are other risks that can occur due to a p2p exchange, for example, two days ago my friend told me that his uncle used the Binance platform to conduct a p2p trading where he wanted to sell 7000$ From bitcoin at a price greater than the market, but unfortunately for him he transferred his balance of bitcoin to the other person and pressed the “release” button before he got the money, and so the other person took the bitcoin and did not transfer the money and this man lost his money as a result of his stupidity and because of this type of service, the fraudster did not return his calls and Binance did not compensate for his loss.
This incident also indicates the danger of this type of trading and that spot trading on platforms is much better and safer.

Sorry banks can freeze account that is flagged and being flagged can happen either through,

1. The government directly: The officers of government or through the government agency can write to a bank on a particular bank account under investigation to suspend transactions on it for a period of time pending investigation on it, this could lead to freezing, suspension or the account being free for transaction.

2. Through the court: The court can also issue an order to a bank to free a particular account either the owner is avoiding arrest to frustrate the person financial source, illegal business owners etc.

3.The bank itself can flag an account on its own: If a bank identify a fraudulent action on an account, it can flag or freeze the account pending findings and resolutions.

The bank is a government agency and can freeze an account because it is working on the directives of the government.

Criminal cases are processed much faster in India. If you have done nothing wrong then there is no question of freezing. Banks nowadays are freezing accounts even without authorization. Its important to make them accountable for an illegal freeze.

It would be better if you add what are the contents edited in OP so that it will be helpful for someone like me who is having short term memory loss.

And again, you may get access to your account back but its not going to be easy and you have to wait for years to access the funds back so being cautious can save lot of your time.

Did you get the freeze order copy from the bank?

There is definitely a real risk that you may be getting funds from frausters when you sell bitcoins on a p2p platform.

Especially in India, where regulations seem to be extremely tight, you need to be very careful not to deal with anyone who is even remotely sketchy.

I would say that you should deal in cash deposits and ask for receipts whenever possible and wherever you are, because that is the closest thing you will get to irreversability and untraceability. That is certainly the norm here in AU.

Scammers are using fake kyc documents to register bank accounts. Nowadays account opening can be done online. Due to rampant negligence in new banks where no physical verification is done scammers are able to take advantage.

The problem is if you don't have proof and you get some illegal funds in your account unknowingly not only will you be charged under various sections of IPC but they can also charge you under PMLA (Prevention of Money Laundering Act) provided you have used the illegal funds to purchase assets or convert it into some other form.

P2P Trading with the wrong person can land you in a hell of a lot of trouble.

How can you exactly stay safe when you are crypto trading if it's your government that is against it and freezes your account, that's just impossible to do. Also, why do they want a KYC when the crypto profits from trading goes into the bank account of the user, it's not like their using an alias to that bank account.

Not only in India, the problem exists in most of the countries and traders are losing their money after months and years later s they don't even know where to start and which trade went wrong.

I made some strong points about avoiding such scammers a long way back but the same points can be helpful even now.

I began to agree with you. A lot of peer-to-peer transactions have become a source of suspicion and can be considered dangerous.
The problem is that although cryptocurrencies can be tracked, many countries do not have enough resources to track these transactions, and because they are multiple countries, it will become impossible to track them.
So it is a suitable place for all scammers.

Extremely useful and correct at the same time. But a major question that I have is that have you or any of your acquaintance have encountered any such incident? Or are you just giving a normal SOP that the banks and vigilance follow whenever such a thing happens? Because honestly speaking I have never heard of anyone stuck so bad that his account froze due to these doubts.
 
Also if anyone gets stuck in this situation I think it really won't be easy to get out of it especially if you have done it through telegram or even the forum.

Staying safe and staying not implicated in Cryptocurrency trading is difficult but it is at least ensured on binance centralised exchange as every peer to peer users are expected to pass their Know Your Customer (KYC) before being allowed to trade. In case of issue of transactions involving a suspected account, I believe one's lawyer can request the investigating officer to contact the exchange to examine that one is not an accomplice in a fraud case but just a p2p cryptocurrency trader.

Any transaction done online leaves a trail. If the coins were sourced illegally then it can still create problems in direct trades as bitcoin is not exactly anonymous. In direct trades, you are usually blindsided to the personal identity of the buyer and the source of funds. It's next to impossible to prove that the coins arrived in your wallet during a direct trade done with cash. It's still better to stick with online platforms as you have enough proof.

People residing in India can take note of the following terms:

Cognizable Offence: It allows a police officer to arrest without a warrant. Please do not worry if you have done nothing wrong. If you fear harassment you can apply for anticipatory or pre-arrest bail.

Non-Bailable Offence: It means that the right to grant bail lies with the court and you need to get the court's permission for availing bail.

Compoundable Offence: It means with the permission of the court/authorities you can settle with the complainant and get your issue resolved. In the case of non-compoundable offences if the chances of conviction are less then the courts may allow settlement and quash the FIR.

Nice and resourceful article! Many people in India have already got their bank account frozen after p2p trading. Because there is no way to know from where the bitcoin buyer is arranging the money for you. So it is always best to avoid unknown traders emerged from nowhere.

I always prefer localbitcoins platform because I can see the rating of a trader from there. Also I can see that how frequently that person trades. An usually active trader will have nice ratings. The best part of localbitcoins is that, you can't post rating for any random people, rather only to the people you have closed a trade contract. So just keep your eye and ears open and you should be fine.

Good article, but proving your involvement in criminal activity just to transfer money from someone's account to your account is not a legal argument.
The problem of you buying and selling to the same person is considered money laundering and may lead to many legal problems, so it is better to buy and sell using cash, gift cards, or anything that does not include bank transfers.

Freezing your account, and if it does not mean losing money, it may waste a lot of time and money on legal procedures.
Peer-to-peer trading is beneficial in reducing fees but it must be approached with awareness and more seriousness.

in my country it self fintech or p2p lending getting crazy so many of them pop up and make easy to take the loan from singe ID card and yes the ID card from custumer kyc can be sell by the company to other provide who need the data

thats why for now i kinda scared to do some kyc if leaks happen we are done

This is quite a useful post and helps people understand the risk in P2P trading. I was always under the impression that P2P trading with these big exchanges are safe. However, I always avoided this route. Now, I'm happy that I never did that.

But yes, explaining people the risk about P2P trading is essential.

The rise of fintech companies has opened the gateway for fraudsters. In a race to open customer account PayTM and other companies are doing online KYC which fraudsters are using to open bank accounts with fake documents.

In case you can't resolve using the above-mentioned methods you might need to contact the local courts to obtain a defreeze notice. FIR copy's are nowadays available on online search portals. You can use them to get more information. Make sure to keep all the relevant proofs and do not do any direct trades.

This post is for those people who are innocent and have their bank account frozen due to a debit freeze order from Cyber Police.

Before we begin, I just wanted to mention that in case you're not fond of reading lengthy articles, you can get a quick overview here:
https://i.imgur.com/5J3DI8p.png

P2P trading is quite popular in India, and many people use it for daily trading. Platforms like Localbitcoins, WazirX, Binance, Paxful, Kucoin, etc., have a lot of liquidity in this space.

Unfortunately, people don't realize the risk of trading in P2P since there is an extremely high possibility of unknowingly getting money from a fraudster's account.

After the onset of the pandemic, the number of cyber frauds has skyrocketed. Cyber Criminals are always looking for ways to launder their money, and P2P Crypto Trading is easy for them to cash out instantly without any trace.


How Does A P2P Fraud Occur, And How Does It Affect Me?
During a fraud, the scammer lures the victim to send funds using a lottery scam, romance scam, etc.

In return, the scammer uses it to buy crypto from an unsuspecting seller (You) through P2P.

There can also be other scenarios where the scammer launches a P2P trade with you and then asks the victim to send funds directly to you.

Once the victim realizes the fraud, they complain to the local Police. The Police immediately get into action and try to locate the money and freeze it. Once they find the amount in a bank account, they send a freeze notice to your Bank's Nodal Officer under Section-102 CrPC to prevent the funds from getting withdrawn. The Police also have the power to get your KYC and transaction details using Section-91 CrPC.

Once the investigation begins, they start scanning all your transactions. They might also freeze accounts of your beneficiaries depending on their suspicion.


Should I Be Worried?
It's natural for you to panic when you realize that the Cyber Police have frozen your bank account.

Your mind starts racing, and you begin thinking about the worst outcomes, like landing in jail for a crime you didn't commit.

It's common for most people to end up with panic and anxiety because they don't know what to do.

I would request you not to worry and instead educate yourself about the law using my post.


What Should I Do After I Discover The Freeze?
Understand Why The Freeze Occurred: To understand why your bank account was frozen, you need to obtain a copy of the freeze notice sent to the bank by the Authorities (Cyber Police).

The banks are usually reluctant to share this copy, but if you're persistent, you can quickly get a hold of it. Remember, you have a legal right to prepare your defense; the freeze notice copy is integral to it.

In case they are reluctant to pass the freeze notice copy, then you can launch a complaint against the bank for free at:
RBI Ombudsman (https://cms.rbi.org.in/cms/indexpage.html#eng)
Public Grievance Portal (https://pgportal.gov.in/)
National Consumer Helpline (https://consumerhelpline.gov.in/)

Once you get the copy of the freeze notice, please read it thoroughly, as it may have details about the nature of the crime. This will help you understand how to prepare for your case.

Check The Section Of Freeze Notice: The section of the freeze notice is super important to understand if your bank account freeze is invalid or illegal. You can find details about the section at the top of the notice.

These freeze notices are usually sent under two sections, i.e., Section-91 and Section-102 CrPC.

If the freeze notice is under Section-91 CrPC, the Police have used the wrong section of CrPC and illegally frozen your account as they do not have the right to do so.

Section-91 only empowers the Police to get KYC and other details from the bank. However, it doesn't empower the Police to freeze your account.

You can read more about Section-91 here:
https://indiankanoon.org/doc/788840/

On the other hand, if the freeze notice is under Section-102 CrPC, it's legal and valid. The only thing to check in this case is whether the Investigating Officer has informed the local Magistrate. This is a mandatory requirement of Section-102 CrPC. You can use a copy application to get details from your local Court.

Reread the freeze notice thoroughly, especially if it's under Section-91 CrPC, and try to locate specific instructions for freezing your account. Sometimes freeze notices are sent only to get details of your KYC and transactions. However, they may not include an instruction to freeze your account.

Determine The Amount Of Fraud: The freeze notice might include details about the amount involved in the fraud. If the amount is small, then with the help of a lawyer, you can negotiate a settlement with the victim and save yourself time and court fees.

Gather Evidence: Once you've finished the steps above, it's time to gather evidence.

The following will help you prove your innocence:
P2P Trade logs and details from the exchange.
IP Address Logs at the exchange.
Location records of your phone.

P2P Trade logs will prove that you conducted trade on an intermediary platform (Binance, WazirX, LocalBitcoins) and had little to no information regarding the buyer's background.

IP Address logs from the exchange will prove your online presence at the intermediary platform (Binance, WazirX, LocalBitcoins) while receiving funds from the scammer.

The location records of your phone will further add to the fact that you were present in front of the computer while receiving funds from the scammer.

All the above details will prove the final fact that you conducted trade with an unknown buyer at an intermediary platform (Binance, WazirX, LocalBitcoins), due to which you ended up receiving stolen money involuntarily.

Contact A Local Lawyer: Check which state/city the freeze notice came from and then hire a lawyer belonging to that state/city. Avoid googling for lawyers, as most of them are inexperienced and will misguide you. The best option is to go with referrals from trusted sources.

How to choose a good lawyer:
1. Select lawyers between the ages of 35-45 as experience matters. Experienced lawyers usually have a vast network and more knowledge.
2. Avoid big law firms, as rookie /junior lawyers will probably take up your case. Prominent lawyers are primarily interested in high-profile cases.
3. Do not disclose the overall balance in the account to your Lawyer. They will use that info to decide your fees. Make sure to ask for their fees before proceeding.


What Should I Avoid Doing After The Freeze?
There are certain acts you should avoid doing as they are not going to produce any results.

Posting On Social Media: I have seen many people discussing their problems on social media and then tagging the Exchange, Cyber Police, Ministry Of Home Affairs, Prime Minister, Finance Minister, etc.

Such moves will only draw unnecessary attention to your case. Most people on social media are inexperienced in law, and they will start blaming the system for your misery. In the end, you will develop a victim mindset and avoid taking responsibility for solving your case.

Contacting The Victim/Bribing The Police: People also try to get in touch with the victim or settle the case under the table with the Police. If you opt for such moves, it will only increase your worries.

If you contact the victim, the Police will get an opportunity to establish a link between you and the victim. They may try to make you a scapegoat in the case.

On the other hand, if you bribe the Police, it's against the law and will land you in even bigger trouble. It can also lead to a case of abetting corruption being filed against you, further tarnishing your image in front of the Court.

Approaching The Consumer Court: In the hopes of getting a quick solution, many people lodge a complaint in the Consumer Court against the bank for deficiency of service or unfair trade practices.

Unfortunately, Consumer Courts do not have jurisdiction over criminal matters, so there is no point in making such a move.

It's also important to note that the banks have complied with the instruction of the Police, so they cannot be held liable for deficiency of service or unfair trade practices.

Such moves will only cost you money and time.

So avoid making uninformed decisions.


The Victim Has Filed A FIR Against Me. What Should I Do?
In a case where the scammer asks the victim to send funds to your account during a P2P trade, then the Police might register a FIR against you.

FIRs are registered under Section-156 CrPC. You have to right to get a copy of it. Most copies are available online on the Citizens portal these days. You can google it or seek the help of your Lawyer to get a copy.

You can read more about Section-156 CrPC here:
https://indiankanoon.org/doc/1291024/

Sometimes the Police will mention the FIR number on the freeze notice. You can refer to it and download the copy online.

Once you download the copy, read it thoroughly to determine the charges against you. Most of these charges are under Section-406 and Section-420 IPC. To prove these charges, the Police need to prove that you had an intention to deceive the victim right from the start of the transaction. In your case, it will be extremely difficult to do so since you did a P2P trade and you did not even know that you were getting involved in a fraud. So you were blindsided, and your action was involuntary. Remember, you cannot be convicted if the Police can't prove criminal intent.

The first thing to do is apply for anticipatory or pre-arrest bail under Section-438 CrPC. Anticipatory bail prevents the Police from arresting you. If you can't get it from lower courts, approach the High Court for the same. Once you get anticipatory bail, make sure to cooperate with the Police fully. Explain your side of the story with the help of your Lawyer.

You can read more about Section-438 CrPC here:
https://indiankanoon.org/doc/1783708/

Suppose the allegations in FIR are baseless and false. In that case, you can also lodge a petition to quash the FIR under Section-482 CrPC. Finally, note that the Courts will only grant such a petition based on merit.

You can read more about Section-482 CrPC here:
https://indiankanoon.org/doc/1679850/

If the FIR gets quashed, the case will get closed. However, you will have to face a trial if you can't get it quashed. Use the pieces of evidence that you have to prove your innocence.

In the meantime, you can use Section 451/457 to lodge a defreeze petition. The defreeze will allow you to access your funds which you can use to fight your case. Please note that you may be required to provide sureties as a deposit to the Court. You will get your deposit back when the case concludes.


Can The Police Arrest Me?
Nowadays, arrests are rare, and unless you've actually done something wrong, the Police won't arrest you. Instead, they may call you for your statement.

In Arnesh Kumar vs. State Of Bihar & Anr on 2 July 2014, the Hon'ble Supreme Court passed special instructions for arrest. It directed all Police officers to avoid automatic arrests for offences that are punishable with imprisonment for a term up to 7yrs (or less).

In most cases of bank freeze due to P2P trading, the FIR is usually registered under Section-406 and Section-420 IPC, both of which are applicable under Section 41A CrPC.

The Hon'ble Supreme Court laid down guidelines for arrest in Section-41A CrPC, which requires the Police to send you a notice for appearance. If you continue to comply with the notice and appear when you're summoned, you shall not be arrested.

You can read more about Section-41A CrPC here:
https://www.indiacode.nic.in/show-data?actid=AC_CEN_5_23_000010_197402_1517807320555&orderno=43

Now this section doesn't necessarily mean that the Police are powerless to arrest you. For example, if they have a reasonable complaint, credible information, or reasonable suspicion against you. In that case, they can still arrest you under the provisions of Section-41 CrPC.

But since this thread is for people who have not participated in a crime, I would say you don't need to worry much about an arrest. In most cases, the FIR might not even include your name. So it will be mandatory for the Police to send you a pre-arrest notice under Section-41A CrPC. If they make an arrest, they will need to record solid reasons for their action, which does not exist in your case. If the Police fail to follow the provisions of Section-41A CrPC you can prosecute them for Contempt of Court.

Suppose you want to be extra cautious and avoid harassment by the Police. In that case, you can file for anticipatory bail in Court under Section-438 CrPC. Inform the Police about your application and ensure them of full cooperation after you receive a copy of your anticipatory bail from the Court.

In most cases, the freeze notice comes from outside your state. You might not even be informed or summoned.

It's important to note that according to Section-160(1) CrPC, the Police cannot summon a person outside their territorial limits. So, if the Police from another state demand your attendance, refer to your Lawyer for the best course of action.

You can read more about Section-160(1) CrPC here:
https://indiankanoon.org/doc/210253/

Here are some favorable judgments passed by our Hon'ble Courts against random arrests:

In Mohd. Zubair vs. STATE OF NCT OF DELHI & ORS., Writ Petition(s)(Criminal) No(s).279/2022

The Hon'ble Supreme Court bench led by Justice DY Chandrachud stated:

"Because it results in one of the gravest possible consequences emanating from criminal law: the loss of personal liberty. Individuals must not be punished solely on the basis of allegations, and without a fair trial. When the power to arrest is exercised without application of mind and without due regard to the law, it amounts to an abuse of power. The criminal law and its processes ought not to be instrumentalized as a tool of harassment. Section 41 of the CrPC as well as the safeguards in criminal law exist in recognition of the reality that any criminal proceeding almost inevitably involves the might of the state, with unlimited resources at its disposal, against a lone individual".


In SATENDER KUMAR ANTIL v.s CENTRAL BUREAU OF INVESTIGATION & ANR.

The Hon'ble Supreme Court stated:

The courts will have to satisfy themselves on the compliance of Section 41 and 41A of the Code. Any non-compliance would entitle the accused for grant of bail.

We also expect the courts to come down heavily on the officers effecting arrest without due compliance of Section 41 and Section 41A. We express our hope that the Investigating Agencies would keep in mind the law laid down in Arnesh Kumar (Supra), the discretion to be exercised on the touchstone of presumption of innocence, and the safeguards provided under Section 41, since an arrest is not mandatory. If discretion is exercised to effect such an arrest, there shall be procedural compliance. Our view is also reflected by the interpretation of the specific provision under Section 60A of the Code which warrants the officer concerned to make the arrest strictly in accordance with the Code.


In POORAN SINGH vs. STATE OF DELHI, BAIL APPLN. 2029/2018

The Hon'ble HC stated:
It is trite law that the Police Officer before arresting the accused who is accused of offence which is punishable with imprisonment for a period of seven years has to be satisfied that such arrest is necessary to prevent a person from committing any further offence; or for proper investigation of the case; or to prevent the accused from causing the evidence of the offence to disappear; or tampering with such evidence in any manner; or to prevent such person from making any inducement, threat or promise to a witness so as to dissuade him by disclosing such facts to the Courts or the Police Officer; or unless such accused person is arrested, his presence in the Court whenever required cannot be ensured.


In Muhammed Rafi v. Satheesh Kumar M.V, CON.CASE(C) NO. 808 OF 2022, CRIME NO.254/2022 OF Vadakkanchery Police Station, Thrissur

The Hon'ble Kerala HC remarked:

Before we part, we deem it proper to remind that the power to arrest an individual vested in the State and exercised through its police officers at various stages of the criminal justice process, cannot be used as a punitive tool or as a measure of harassment unmindful of the duty to take into account the safeguards provided under Section 41 of the Cr.P.C. before the arrest of a citizen.


In RAKESH KUMAR v. VIJAYANTA ARYA (DCP) AND ORS

The Hon'ble Delhi HC sentenced the police officer to one-day imprisonment along with a fine of 2000INR and 15000INR (given to the victim) for violating the guidelines of Section-41(A).


In JAGDISH SHRIVASTAV vs. THE STATE OF MAHARASHTRA & ANR. (Crl.) No(s). 1758/2022

The Hon'ble Supreme Court has stated the following:
We deprecate such practice of the Police Officer in overstepping after the matter being instituted in this Court and taking the petitioners into custody without compliance of Section-41(A) Cr.P.C. and keeping in view the judgment of this Court in Arnesh Kumar vs. State of Bihar & Anr. (2014) 8 SCC 273.


In Sudhir Mehrotra vs. Investigating Officer & ANR., CONTEMPT APPLICATION (CRIMINAL) No. - 5 of 2022

The Hon'ble Allahabad High Court sentenced the Police officer to 14 days imprisonment for breaching Arnesh Kumar's guidelines on arrest.


Here is a good news article regarding arrest:
https://indianexpress.com/article/india/personal-liberty-important-aspect-of-constitutional-mandate-arrest-should-not-be-routinely-made-sc-7462666/


What Should I Do If I Have Visit The Police Station?
You may receive a notice from the Police Station under Section-41(A) demanding your appearance if you reside in their local jurisdiction.

In case they haven't sent you a notice under Section-41(A), then ask them to send you one.

Before visiting, ask them if they have installed functional CCTV cameras as per the directive of the Hon'ble Supreme Court. Keep this conversation on WhatsApp so that you have evidence if needed.

In Paramvir Singh Saini vs. Baljit Singh & Others Special Leave Petition (Criminal) No. 3543 of 2020

The Hon'ble Supreme Court directed all Police Stations to be equipped with CCTV Cameras. It also instructed that these cameras must be equipped with night vision and consist of audio and video footage.

CCTV cameras ensure the Police cannot harass you in any way.

Suppose the Police Station doesn't have a proper CCTV setup. In that case, you can lodge a contempt of court petition with your Lawyer's help. But make sure to cooperate with Police before you do so.

Also, if you have acquired an anticipatory bail, send the copy to the Police Station before making an appearance.

While recording your statement with the Police, make sure to read it at least three times to understand if it was noted correctly. In case of errors, you can refuse to sign the statement. Never sign any statement without reading it thoroughly.


What Are My Rights At The Police Station?
The Constitution of India has given you three important rights:

1. Right to remain silent: Article 20(3) of the Constitution and Section-161(2) of the CrPC allows you to protect yourself against self-incrimination. Even during police interrogation, you are entitled to remain silent. The Police cannot physically or mentally coerce you to give a confession.

For your information, Article 20(3) of the Indian Constitution states that "No person accused of an offence shall be compelled to be a witness against himself."

You can read more about Section-161(2) here:
https://indiankanoon.org/doc/1110422/


2. Right to consult a Lawyer: You can always ask your Lawyer to accompany you when you visit the Police Station.

3. Protection against torture: No Police Officer can torture you to get a confession. Also, a disclosure statement made in police custody, unless it leads to actual recovery, etc., will not be considered admissible evidence in Court.


How Can I Get My Account Defreezed?
Alright, now that we've reached the end of this article, let's discuss the remedy.

Following are the different scenarios that can happen and how you can solve them:

Bank Does An Illegal Freeze: Most banks don't even read the notice properly and proceed to freeze your account. Sometimes the banks will receive a notice under Section-91 CrPC, which does not have an instruction to freeze, yet they freeze your account. Such freeze is illegal, and you complain against your bank at:

RBI Ombudsman (https://cms.rbi.org.in/cms/indexpage.html#eng)
Public Grievance Portal (https://pgportal.gov.in/)  
National Consumer Helpline (https://consumerhelpline.gov.in/).

The above government portals can help you get your account defreezed without any cost.

Freeze Notice Is Under Section-91 CrPC: As mentioned above, the Police do not have the power to freeze your bank account under Section-91 CrPC.

The same has been iterated by the Hon'ble Uttarakhand HC in paragraphs 10 and 11 here:
https://app.box.com/s/f119n0cbsf7vorgnx1hv3wn61eauqpqm

You can show the above judgment to your Lawyer for reference purposes.

You can launch a defreeze petition under Section-451/457 CrPC in lower courts and challenge the illegal freeze on technical grounds. If you're willing to provide sureties to Court as a deposit, then the Court might consider defreezing your account.


Freeze Notice Is Under Section-102 CrPC: When the freeze notice is under Section-102 CrPC, it's usually a valid freeze. However, in some instances, the Investigating Officer does not comply with the provisions of this section.

To understand the compliances mentioned above, let's first take a look at Section-102 CrPC.

You can read about it here:
https://indiankanoon.org/doc/648213/

The word "forthwith" is mentioned in Section-102(3) CrPC, which means that the Investigating Officer has to report the seizure of your Bank Account to the local Magistrate as soon as possible. However, they usually ignore this requirement and may report it late. If they are unable to justify the delay, you can challenge the freeze in Court (under Section-451/457 CrPC) for non-compliance.

In the judgment reported in “1994 Supp (2) SCC 372 (Arjun Marik and others versus State of Bihar)”, wherein, the Honble Supreme Court dealt with a word forthwith occurring in Section 157 Cr.P.C., and held that forthwith means without any undue delay and immediately.

You can cite this judgment to defend your case if the Investigating Officer delays reporting the seizure.

To determine whether the seizure was reported or not, you can send a copy application to your local Court and confirm the same.

For a freeze to be valid under Section-102 CrPC, the property (Your Funds) must be either:
Alleged or suspected to have been stolen; or
Have a nexus between the property and the commission of the crime.

So the Investigating Officer needs to prove that you are in possession of the stolen property and you played a role by participating in the crime.

If you have received money directly from the victim or the scammer, it proves that you have stolen property.

But the Investigating Officer cannot establish the nexus as you can always claim that you received the funds unknowingly on a P2P platform while performing a random trade. This will again help you challenge the freeze in Court (under Section-451/457 CrPC) for non-compliance with provisions. Please note that the Court may ask for sureties before issuing a defreeze order.

An alternate remedy to approaching the courts would be to provide sureties in the form of a bond to the Police under Section-102(3) CrPC. Depending upon their satisfaction, they may allow your bank account to be defreezed.

Now I shall provide some useful judgments which will help your Lawyer challenge the freeze in Court:

The High Court of Telengana in Hajji Mohammed Sattar vs. State of Telangana ACB where it considered the fact that not only is the Petitioner a third party to the crime but also the statement of the bank account was already secured by the authorities. Therefore, given that the statement of bank account was already secured, the Court held that the offence (if any) could be proved from the entries made in the bank account. Since no other incriminating evidence was found by the investigating authority even after freezing the account, the Court found no reason to keep the accounts frozen.

In B. Kavitha vs. The Inspector of Police, the High Court of Madras while directing the de-freezing of an account pointed that the investigating authorities had not only failed to comply with the mandate of Section 102 but had also frozen the bank accounts without even registering an FIR, showing the hastiness of the officers' actions. The Court also considered that the said bank accounts were being used to repay the Petitioner's loan amounts. As such, the Court found the actions of the investigating authority as violative of the Petitioner's fundamental right under Article 21 of the Constitution.

Madhu vs. Sub Inspector of Police, the Court stated that a Petitioner can approach the High Court itself if the freezing is per se contrary to the provisions of law and could be assailed as illegal without reference to factual disputes involved in the matter.

Judgment of the Madras High Court titled as T. Subbulakshmi & Anr. v. The Commissioner of Police & Ors., 2013 SCC OnLine Mad 2629, which reiterates that the seizure has to be reported forthwith to a magistrate which is a necessary requirement and if the requirement is not fulfilled, then the seizure cannot be legally sustained.

In the case of Uma Maheswari & Anr. v. State rep. by Inspector of Police, 2013 SCC OnLine Mad 3829, the Court held that reporting of the freezing of the bank accounts is mandatory. Failure to do so will vitiate the freezing of the bank account. It shall be reported forthwith to the jurisdiction magistrate. The phrase shall employed in Section 102(3) Cr.P.C is held to be mandatory in nature and violation of it goes to the root of the matter.

Muktaben M. Mashru v. State Of Nct Of Delhi & Anr 29-11-2019 (Delhi HC)
Court is of the considered view that the order of IO of debitfreezing of bank accounts of accused / applicant Muktaben is in clear violation of mandatory requirement of law and therefore. The accounts of Muktaben seized/debit-freezed on the request of IO are directed to be de-freezed.

Para 38: It is an admitted fact that the IO had not informed the concerned Magistrate forthwith regarding the prohibitory order and also did not give any notice to the petitioner and the co-account holder, Piyush Bhai Thakkar, allowing her/him to operate the bank account, subject to her/his executing a bond undertaking to produce the amounts in court, as and when required or to tell her/him, subject to such orders as the Court may make regarding the disposal of the same.

The High Court of Bombay in Gulam Sarvar vs. State of Maharashtra and Ors.[5] in this context held that the:
Making of an allegation simplicitor; for the purposes of Section 102 of Cr.P.C., is not sufficient and it must be shown that the allegation is founded on such a material as to at least create a reasonable suspension about the amount in the account having some connection or possibility of having some connection with the commission of crime.

In R.Chandrasekar vs Inspector of Police, Salem [2002 (5) CTC 598], it was held that seizure of bank account by the investigating officer must be reported to the Magistrate as it is a mandatory requirement of law.

In Karthika Agencies Export House v.s The Commissioner of Police & Others, WP.No.17953 of 2021 and WMP.No.10605 of 2021, Hon'ble Justice GK Ilanthiraiyan (Madras HC) stated that:

The Hon'ble Supreme Court of India and this Court repeatedly held that the provision under Section 102(3) of Cr.P.C. requires that the police officer shall forthwith report the seizure to the Magistrate having jurisdiction. In the case on hand, the account was frozen on 18.02.2021 and the same was informed to the Magistrate concerned only on 17.09.2021. Therefore, the information of the seizure reported to the Magistrate only on 17.09.2021. Thus, the condition contemplated under Section 102(3) of Cr.P.C. to forthwith report the seizure before the Magistrate has not been complied with as well as it is not known whether superior officer has been informed in compliance with Section 102(2) of Cr.P.C.

In Narayan Yadav v. State of Karnataka, WRIT PETITION NO.226989/2020 (GM-RES), Hon’ble Mr. Justice Mohammad Nawaz  stated:

It is the contention that the freezing of the bank account of the petitioner was not reported forthwith to the Jurisdictional Magistrate, which is mandatory. It is not in dispute that all the four bank accounts of the petitioner have been freezed by virtue of the notice issued by the Investigating officer. Certainly such freezing of account would adversely affect his right to life under Article 21 of the Constitution of India.

The Amount Involved In The Fraud Is Very Small: Sometimes, the amount of fraud is mentioned on the notice. If you can't determine the amount, you can approach your Lawyer to figure it out from the Investigating Officer.

Suppose this amount is relatively small as compared to the funds available in your frozen account, then you can opt for a settlement with the victim.

You must be wondering why I mentioned this method when I was against it in the above paragraphs. The answer is it can save you time and money.

Whenever you are making a settlement with the victim, never contact them directly. Ask your Lawyer to do all the talking. With the help of your Lawyer, make a written agreement with the victim. Once the victim is ready to settle and cancel their complaint/FIR inform your Investigating Officer via email. Never agree for verbal settlements or send settlement money via cash. Use digital payments for the sake of proof.

After you send the money to the victim, ask them to inform the Investigating Officer immediately to cancel the complaint/FIR. Once it's done, you can request the Investigating Officer to send a defreeze notice to your bank.

All Your Bank Accounts Have Been Frozen: In this scenario, you lose complete access to your funds. Such a freeze affects your right to life, guaranteed under the Indian Constitution.

If all your accounts have been frozen, the first thing you need to do is to borrow some money from your friends and relatives. Use this money to hire a lawyer and file a defreeze petition in the High Court on the basis of violation of the right to livelihood under Article 21 of the Constitution. If you have proof that the freeze is unjustified, then you can also file a petition on the basis of violation of Article 14 of the Constitution as well.

For your reference:
Article 21 of the Indian Constitution states that "No person shall be deprived of his life or personal liberty except according to procedure established by law."
Article 14 of the Indian Constitution states that "The State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India Prohibition of discrimination on grounds of religion, race, caste, sex or place of birth."

The following judgments will help:

In the case of Mr.Prakash Padukone and others vs. State of Karnataka [W.P.No.13516-13518/2018 (GM-POLICE) - 4.04.2018], the Hon'ble High Court stated the following:

This court is of the firm opinion that unless and until there is a strong suspicion against the petitioners, the Police would not be justified in freezing the account belonging to the petitioners. For, such freezing of account adversely affects the right to life under Article 21 of the Constitution of India.


A single-judge bench of Justice Mohammed Nawaz while allowing the petition filed by one Narayan Yadav [WRIT PETITION NO.226989/2020 (GM-RES)] in the Karanataka HC said:

It is not in dispute that all the four bank accounts of the petitioner have been frozen by virtue of the notice issued by the Investigating officer. Certainly such freezing of accounts would adversely affect his right to life under Article 21 of the Constitution of India.


Can I Get Compensation For An Illegal Freeze?
Once you prove that the freeze was illegal, you can ask the Court for a compensation from the Police. It's possible to get compensated, but it won't be easy as it will depend on your case's facts and the Court's discretion.

Here is a rare judgment you can refer to:
Swaran Sabharwal vs. Commissioner of Police
https://www.casemine.com/judgement/in/560909cce4b0149711170ac3


How Can I Protect Myself From P2P Fraudsters?
Despite having the means, most P2P platforms (like Binance and WazirX)  do not conduct any physical or video verification. This makes their platform a fertile ground for cyber-criminals.

So if you want to stay safe while trading cryptocurrencies, do it directly on the platform instead of dealing with unknown strangers.

I would like to conclude by saying that if you've done nothing wrong, you have no reason to worry. The law protects the innocent. Court cases might take time, but there is light at the end of the tunnel. So you just have to be patient.


If you have any queries, feel free to send me a private message, and I will do my best to help you.