Govt bans bulk SIM card sale, makes police verification of dealers mandatory

To combat the rise in fraud cases in the telecom industry, the Indian government has made police verification of SIM card distributors mandatory. The new mandate is intended to prevent unauthorized persons from entering the industry and to eliminate any possibility of fraud or criminal activity associated with SIM card sales. In addition, the government has decided to discontinue mass connections, which are often used for illegal activities such as creating false identities or conducting fraudulent transactions. Later, it even clarified that the validation process for SIM card dealers would be carried out by “the licensee” or the respective telecom operator, along with imposing a fine of Rs10 lakh on those who break the rules. “SIM dealers who are complicit in such schemes will be fined 10 lakhs,” Vaishnaw added. In particular, these measures are in line with the government’s objectives of protecting the well-being of citizens and maintaining the credibility of the telecommunications sector. Through the enforcement of stricter regulations and the establishment of comprehensive verification procedures, the government seeks to establish a more secure telecommunications landscape within the nation. As part of an extensive campaign to combat digital fraud linked to SIM cards, the minister even shared that the government has disabled 52 lakh mobile connections. In addition, 67,000 dealers were added to a blacklist, and as of May 2023, 300 FIRs have been filed against SIM card dealers in a concerted effort. In addition to government measures, WhatsApp has also taken steps to combat fraud on its platform. The company has blocked around 66,000 accounts that were involved in fraudulent activity. This includes accounts that were used to send spam messages, phishing links, and other malicious content. Meanwhile, Mr. Vaishnaw said that there are 10 lakh SIM card dealers and they will be given enough time for verification. A new concept of “business connection” will be introduced, in which each corporate subscriber will be required to undergo KYC (Know Your Customer) when issued a SIM card. The existing massive system required companies to keep records of individual subscribers. However, the new business connection system will require companies to verify the KYC of the person who takes physical possession of the SIM card. This will help reduce fraud. Aadhaar prints or physical cards provided as proof of identity or address will also need to be verified by scanning the QR code. This will help ensure that the information provided is authentic. In particular, mass subscribers from government, defense and law enforcement will remain exempt from additional verification requirements, he further emphasized. The upcoming regulation will take effect on October 1, allowing dealers approximately six months to achieve compliance. However, the Department of Telecommunications (DoT) has not yet released detailed guidelines on these new penalties.