Scam centres

The arrest of 212 individuals in Islamabad this week on suspicion of running international fraud operations is the latest example of why Pakistan is now widely associated with phone- and internet-based financial scams in wealthy countries. Apart from the arrests, raids by the National Cyber Crime Investigation Agency (NCCIA) on three call centres also yielded hundreds of computers and mobile phones, which helped underscore how the largely unregulated call centre industry has evolved into a sprawling infrastructure for committing financial fraud abroad.

The Sindh home minister recently revealed that call centres in Karachi alone had facilitated international fraud worth approximately $60 million, with proceeds laundered through Bitcoin and US dollars. Investigators describe networks impersonating Google representatives, running "love-dating" schemes and using private material to extort victims abroad. And while most Pakistani businesses are struggling to attract foreign investment, fraud centres have brought in both investment and expertise.

Foreign experts have noted that Pakistan stands out as a fraud call centre hub because its internet and telephone infrastructure is far behind other notorious countries, but laws regulating the sector are weak and criminal penalties are nominal. Regulatory gaps are most obvious. The PTA has explicitly stated it does not regulate call centres or software houses, while the PSEB has registered over 7,400 call centres but doesn't actually monitor them for illegal conduct. Meanwhile, NCCIA is one of the few agencies with the mandate and capability to act against call centres, but its own staffers are on the take - several months back, NCCIA officers were busted running an extortion racket that collected nearly Rs300 million from illegal call centres in exchange for monthly "protection fees".

The government's recent licensing requirement for call centres is a good step, and only 25 years too late. Still, if we ensure that monitoring and prosecution of call centres will now be up to the mark, we may shed yet another ignominious international title.