MobiKwik fraud: Tech glitch misused to siphon off ₹40 crore; 6 held, 2,500 bank accounts frozen

Six people from Nuh and Palwal districts of Haryana were arrested for allegedly siphoning off more than ₹40 crore from digital wallet firm MobiKwik by exploiting a technical fault in its mobile application.

The Gurugram police have also frozen 2,500 bank accounts having a total of ₹8 crore in connection with the case.

Investigators said a flaw in the app allowed certain transactions to be marked as successful even when payments had failed. Some merchants allegedly misused this loophole to transfer money into thousands of bank accounts.

The case came to light after One MobiKwik Systems Limited alerted Gurugram police on September 12 about unusual transactions.

A complaint filed by the company stated that user payments via UPI or QR code usually reach merchant accounts only after successful processing. However, in this instance, failed transactions were also credited.

By manipulating the bug, the accused managed to divert over ₹40.22 crore, the complaint alleged.

"Normally any user makes payment from his MobiKwik wallet via UPI, or transfers funds by scanning QR code which are credited to MobiKwik registered merchants' accounts only when customer transaction is successful. But due to a technical glitch, some failed transactions were also being shown as successful in favour of the merchant,” the complainant said.

"Some registered merchants took undue advantage of this technical glitch and illegally transferred Rs 40,22,32,210 to different bank accounts.”

Based on the complaint, an FIR was registered at Sector 53 police station the next day.

After the initial inquiry, police arrested Rehan of Rewasan village, Waqar Yunus, Mohammad Amir and Mohammad Ansar of Kameda village, Wasim Akram of Maroda village, and Mohammad Sakil of Utawad village.

"During interrogation, the accused revealed that due to some technical glitch in the MobiKwik app, all the transactions done through the app were getting completed successfully irrespective of whether there was any balance in one's bank account or MobiKwik wallet or not. Even after entering the wrong password in the app, the transactions were being completed successfully," a spokesperson of the Gurugram police said.

The six accused were produced before a local court on Tuesday and remanded to judicial custody.

Police in neighbouring Nuh district have also cautioned residents after several bank accounts there received suspicious credits.