DoT, SEBI sign MoU to curb telecom misuse in securities market fraud

The Department of Telecommunications and SEBI signed an MoU to combat financial fraud. This partnership involves sharing data like the Financial Fraud Risk Indicator to proactively prevent misuse of telecom resources in the securities market.

In a move aimed at strengthening the security of India's financial ecosystem, the Department of Telecommunications (DoT) and the Securities and Exchange Board of India (SEBI) on Wednesday signed a Memorandum of Understanding (MoU) to enhance cooperation in tackling the misuse of telecom resources in securities market frauds and investment-related scams.

As per an official statement by the Ministry of Communication, the agreement was signed by Sanjeev Kumar Sharma, Deputy Director General, AI & Digital Intelligence Unit (AI&DIU), DoT, and Sandip Pradhan, Whole Time Member, SEBI, in the presence of Deb Kumar Chakrabarti, Member (Services), Digital Communications Commission.

Structured Data-Sharing Mechanism

At the core of the partnership is a structured data-sharing mechanism designed to enable early detection and prevention of fraudulent activities. As part of the arrangement, DoT will share the Financial Fraud Risk Indicator (FRI) with SEBI to help identify mobile numbers linked to suspicious patterns through multi-dimensional analysis. In addition, the Mobile Number Revocation List (MNRL) will be shared automatically, allowing SEBI-regulated entities such as brokers and asset management companies to ensure that investor accounts are linked only to active and valid mobile numbers.

Reciprocal Intelligence Exchange

In a reciprocal arrangement, SEBI will share inputs on telecom resources associated with accounts involved in cyber fraud, impersonation, and money mule activities, enabling timely action from the telecom side. The intelligence exchange will be facilitated through DoT's Digital Intelligence Platform (DIP), which connects more than 1400 stakeholders and enables real-time sharing of actionable information across institutions.

Shift to Proactive Prevention

According to the Ministry of Communications, the collaboration is particularly significant in the context of India's rapidly expanding digital investment ecosystem. By integrating telecom intelligence with financial market surveillance, the initiative aims to shift from a reactive enforcement approach to a more proactive prevention framework. The Financial Fraud Risk Indicator, which draws inputs from DoT's Chakshu facility under Sanchar Saathi, financial institutions, and law enforcement agencies, will act as an early warning system to flag potentially fraudulent mobile connections before they are used for scams.

Building on Existing Initiatives

The partnership builds on existing initiatives under Sanchar Saathi, through which more than 88 lakh fraudulent mobile connections have already been disconnected using ASTR. The deployment of FRI has also helped prevent financial losses of approximately Rs 2300 crore in the past ten months. Going forward, the MoU will enable the development of standard operating procedures for coordinated action and facilitate institutional sharing of red-flag indicators, with the aim of strengthening investor protection and enhancing trust in India's digital and financial ecosystem. (ANI)

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