Learn how to file complaints against fraudulent e-commerce platforms, pursue consumer commission cases, or escalate to criminal proceedings. Whether you are an online shopper, seller, or legal professional, this guide will help you navigate the complex world of e-commerce fraud.
Table of Contents
Introduction
I received a call at 11:47 p.m. last Tuesday.
“I need your help. I think I have been scammed, and I am not clear on what to do,” said Meera, my next-door neighbour. A software project manager who would navigate countless tech challenges at work but was now completely lost in the maze of digital deception.
“Tell me what happened.”
“Remember that electronics sale I mentioned? TechBargain.in? The 70% off deal on branded phones?” Her voice was shaking. “I ordered an iPhone 14 Pro for Rs. 45,000 instead of the usual Rs. 80,000. The website looked identical to Amazon: same colour scheme, similar font, even customer reviews with profile photos.”
I could picture her in her study, probably staring at the fake phone that had arrived three days earlier, surrounded by printouts of transaction confirmations and screenshots she had frantically taken as evidence.
“And what did you actually receive?”
“A plastic replica that weighs half what it should. It does not even switch on properly: just shows a fake Apple logo and dies.” The frustration in her voice was palpable. “But here is the worst part: when I tried to return it, their customer service started this elaborate run-around. First, they said ‘quality check required’ and asked me to pay Rs. 3,000 for ‘inspection fees.’ Then they claimed I had damaged the packaging and needed to pay Rs. 5,000 for ‘restocking.’ Now they are demanding Rs. 8,000 for ‘reverse shipping’ to return a phone that was fake from day one.”
“Please tell me you did not pay these extra charges.”
“I paid the first Rs. 3,000 because they said it was refundable.” Her voice cracked. “They sent me an official-looking email with tracking numbers and everything. I genuinely thought it was part of their return process.”
“Meera, how did you pay for the original purchase?”
“Debit card. They offered an extra 5% discount for direct bank payments, and I thought I was being smart by saving money.” She paused. “The website had all the security badges: SSL certificate (a certificate that authenticates a website), ‘verified by Mastercard,’ even fake Norton security seals. I checked for the green padlock, I looked for HTTPS. I thought I was being careful.”
This conversation: desperate, confused, tinged with self-blame, happens in Indian homes every single day. Tech-savvy professionals, careful parents, and experienced shoppers are all falling victim to frauds so sophisticated that they fool even cybersecurity experts.
What makes this epidemic particularly cruel is how scammers exploit our trust in technology that was meant to make our lives easier. Every security feature we have been taught to look for can now be convincingly faked. Every protection we rely on: customer reviews, return policies, payment gateways, has been weaponised against us.
In this article, we will explore the complete legal arsenal available to fight e-commerce fraud, from platform complaints to criminal prosecution. Through real cases and practical examples, we will examine how these scams operate and provide strategic options for consumers seeking justice and refunds.
What is e-commerce fraud?
Picture this scenario: Roshan, a 32-year-old Pune businessman, sees a Facebook ad for “ClearanceKart” offering genuine branded watches at an 80% discount. The website displays glowing customer reviews, secure payment badges, and even has a return policy that matches legitimate e-commerce sites.
Two months later, Suresh has received a broken plastic watch worth Rs. 200 instead of the Rs. 25,000 Rolex he ordered. The website now shows “under maintenance,” and the customer service numbers ring endlessly without response.
This is not exaggerated.
From a legal perspective, e-commerce fraud cases span multiple jurisdictions and law enforcement agencies, making them complex to prosecute. From a consumer’s standpoint, a single fraud can mean losing money on essential purchases, receiving dangerous counterfeit products, or having personal data stolen.
What is India’s legal framework that protects you against e-commerce fraud?
A. Primary consumer protection laws
a. Consumer Protection Act, 2019
- Covers: All online purchases, defective goods, deficient services, and unfair trade practices
- Powers: Consumer forums can order refunds, compensation, and punitive damages
- Key provisions: E-commerce entities are liable for ensuring product authenticity and timely delivery
b. E-commerce Rules, 2020 (under Consumer Protection Act)
- Covers: Mandatory disclosures, grievance redressal, and platform liability for third-party sellers
- Violations: Include non-compliance with return policies, fake reviews, and misleading advertisements
B. Cybercrime and Digital Laws
a. Information Technology Act, 2000
- Covers: All digital fraud, online cheating, and data theft on e-commerce platforms
- Powers: Cybercrime cells can investigate cross-border fraud and freeze digital assets
- Key provisions: Sections 66C (identity theft), 66D (cheating by impersonation), 43A (makes companies liable for negligent data handling) and 72A (criminalise the disclosure of personal information without consent)
b. Bharatiya Nyaya Sanhita, 2023 (Sections 318-319)
- Covers: Cheating, criminal breach of trust, and dishonestly inducing delivery of property
- Violations: Include fake product sales, non-delivery after payment, and counterfeit goods
C. Digital Personal Data Protection Act 2023 (when it is enforceable completely)
- Will impose strict penalties on platforms that mishandle customer data
- Requires explicit consent for data collection and processing
- Mandates data breach notifications within 72 hours
- Provides customers’ right to erasure and data portability
C. Financial protection framework
a. Payment and Settlement Systems Act, 2007
- Covers: Unauthorised payment gateway fraud, digital wallet scams, and banking fraud
- Powers: RBI can blacklist fraudulent payment systems and order customer compensation
b. Foreign Exchange Management Act (FEMA), 1999
- Covers: Cross-border e-commerce fraud and illegal foreign exchange transactions
- Mandatory: International payments must comply with RBI guidelines
How digital scammers target consumers
“The most frustrating part,” Meera continued in our society meeting, “is how professional everything looked. They had size charts, detailed product descriptions, and even a live chat feature that responded within minutes. I genuinely thought I had found an amazing deal.”
She is right. The line between legitimate flash sales and sophisticated scams is becoming razor-thin. Let me walk you through the 10 most common e-commerce and 3 emerging fraud tactics that trap even experienced online shoppers.
Here are the major types of e-commerce fraud explained through real-world scenarios:
1. Fake e-commerce websites
The above example of Roshan explaining about e-commerce fraud scenario is a classic example of a fake e-commerce website.
But, here are a few red flags he missed but which you could pay attention to:
- The domain was only 3 weeks old
- No physical store addresses listed
- Customer reviews were all posted on the same dates
- The SSL certificate was free.
2. Counterfeit product sales
Scenario: Rupal, a Surat-based fashion blogger, ordered a “genuine” Louis Vuitton bag for Rs. 1,50,000 from “LuxuryOutlet.in” that claimed to sell authentic designer goods at wholesale prices.
What happened: She received a poorly made replica with crooked stitching and cheap hardware. The seller provided fake authenticity certificates and refused returns, claiming “all international sales are final.”
Investigation revealed:
- Images were stolen from the official LV website
- “Authenticity certificates” were created using basic design software
- The same seller operated 15 different luxury brand websites
- Products were manufactured in a small factory in Haryana
3. Non-delivery fraud
Scenario: Kavita Sharma ordered gold jewellery worth Rs. 80,000 for her daughter’s wedding from “TraditionalJewels.com” in January 2024, paying the full amount in advance for “custom designs.”
What happened: The seller provided regular updates with fake progress photos (stolen from other jewellers), shipping confirmations with non-functional tracking numbers, and elaborate excuses about “customs delays” and “quality checks.”
The reality: No jewellery was ever manufactured. The seller collected money from 200+ customers and disappeared before any deliveries. Families had to scramble for last-minute alternatives at much higher prices.
4. Identity theft through fake KYC
Scenario: Amit Singh, a Bangalore IT professional, created an account on “TechMegaStore.in” to buy a laptop. The site requested extensive verification, including PAN card, Aadhaar, bank statements, and employment details for “premium customer status.”
What happened: Within weeks, Amit received calls from loan sharks, credit card companies, and dating apps. Someone had used his identity to:
- Apply for multiple personal loans
- Create accounts on gambling websites
- Register for cryptocurrency exchanges
- Open fake social media profiles for romance scams
The data misuse: His information was sold on dark web forums for Rs. 500 per complete profile. The fraudsters made more money selling data than from product sales.
5. Subscription trap scams
Scenario: Misha, a fitness enthusiast, ordered “free trial” immunity supplements from “WellnessFirst.co.in”, paying only Rs. 99 shipping charges during the COVID-19 pandemic.
What happened: Hidden in the 15-page terms and conditions was automatic enrolment in a monthly subscription costing Rs. 2,999. Her credit card was charged for 6 months before she noticed.
Cancellation horror:
- Customer service demanded a written cancellation request
- Required medical certificate stating she did not need supplements
- Asked for a notarised letter from the family doctor
- Imposed Rs. 5,000 “early termination fee”
6. Social media marketplace frauds
Scenario: Neha Gupta followed “TrendyVibes_Official” on Instagram: an account with 45,000 followers selling trendy clothes. The account posted daily stories of “happy customers” and influencer collaborations.
What happened: She ordered a dress for Rs. 3,500. The account was deactivated immediately after payment, and all “customer” profiles in comments were revealed to be fake accounts created by the same scammer.
Modus operandi:
- Used professional product photography (stolen from international brands)
- Created fake customer testimonials with purchased follower accounts
- Timed scam around festival season for maximum impact
- Operated multiple similar accounts simultaneously
7. Bait and switch product fraud
Scenario: Rohit Verma, an engineering student, ordered a “Gaming Laptop with 16GB RAM, 1TB SSD” for Rs. 55,000 from “ComputerBazaar.in” for his final year projects.
What happened: He received a laptop with 4GB RAM, 256GB storage, and integrated graphics instead of a dedicated graphics card. The product page was secretly updated after his purchase to show lower specifications.
The legal grey area: The seller claimed “specifications subject to availability” in fine print and offered a Rs. 2,000 refund for the “inconvenience” rather than a full refund for misrepresentation.
8. Fake review manipulation
Scenario: Manish Agarwal, businessman, chose “ElectroHub.in” for bulk electronics purchase based on excellent reviews – 4.8/5 stars with 2,000+ reviews praising fast delivery and genuine products.
What happened: Products were low-quality Chinese imports. Investigation revealed the seller had purchased reviews from the outskirts of Nepal: 50 fake reviews for Rs. 500.
Review the fraud network:
- Created hundreds of fake Amazon and Google accounts
- Used different IP addresses to post reviews
- Synchronised positive reviews with negative reviews for competitors
- Charged other sellers Rs. 10,000 for “reputation management”
9. Cross-border payment fraud
Scenario: Deepak Nair, a businessman, found “amazing deals” on electronics from “USADirectImports.com”, claiming to ship original American products to India at wholesale prices.
What happened: After paying $500 via international wire transfer, he received shipping confirmations from “US warehouse.” The package never arrived, and tracking showed it was never actually shipped from the USA.
International complexity:
- Scammers operated from Malaysia using US-sounding company names
- Used legitimate-looking US addresses (mail forwarding services)
- Made asset recovery nearly impossible due to cross-border jurisdictions
- Exploited customers’ trust in the “imported = better quality” mindset
10. Cryptocurrency payment frauds
Scenario: Vikash Kumar, a start-up founder in Hyderabad, needed to purchase specialised equipment quickly. “TechSuppliers.net” offered a 20% discount for cryptocurrency payments to “avoid banking delays.”
What happened: After paying 2.5 Bitcoin (worth Rs. 18 lakhs), the seller claimed the equipment was “stuck in customs” and demanded additional cryptocurrency for “clearance fees.” Eventually, all communication stopped.
Crypto fraud advantages for scammers:
- Payments are irreversible
- Difficult to trace across multiple wallets
- No chargeback protection like credit cards
- Creates a false sense of legitimacy among tech-savvy victims
Here are some emerging AI-powered fraud tactics which you must watch out for:
11. Deepfake celebrity endorsements
Scammers create convincing fake videos of celebrities promoting investment scams. Steve Beauchamp, 82, lost over $690,000 after seeing a deepfake Elon Musk video that looked and sounded authentic. Similar scams featured fake Taylor Swift ads for cookware and political figures endorsing investment schemes.
12. AI-generated phishing evolution
Since ChatGPT’s launch, phishing emails increased by 1,265% with perfect grammar and personalised details. AI now scrapes social media to create hyper-targeted messages referencing recent purchases, interests, and personal events, making detection nearly impossible.
13. Dark web AI tools
Criminals developed malicious AI platforms like WormGPT and FraudGPT (ChatGPT alternatives) without safety guardrails that help create phishing emails, malware, and spoofed websites specifically for fraudulent purposes.
The data theft dimension of e-commerce fraud
“The worst part was not losing the money,” Meera confided during our follow-up conversation. “Two weeks after the TechBargain fraud, I started getting calls from loan sharks, dating apps, and insurance companies. Somehow, they had my details, banking information, even my office address.”
This brings us to a darker aspect of e-commerce fraud that most victims do not anticipate: data theft and identity misuse. Modern e-commerce scams are sophisticated data harvesting operations disguised as shopping platforms.
How does your data become the real product?
When you register on a fraudulent platform, you typically provide:
- Full name, address, and phone number
- Email ID and often alternate contact details
- Payment card information and banking details
- Shopping preferences and browsing behaviour
- Sometimes, even a PAN card or Aadhaar for “verification”
What happens next: Fraudsters do not just steal your money; they sell your data to the highest bidder. Your information enters the dark web marketplace, where it is purchased by:
- Other scam operations for targeted fraud
- Telemarketing companies for aggressive sales
- Identity thieves for financial fraud
- Blackmail operations for extortion schemes
Let us briefly discuss cross-border challenges while dealing with e-commerce fraud
Here is a real-world example (name changed) of a cross-border e-commerce fraud that will mainly help you understand the way of operation and the challenges faced in cracking such fraud.
Anushka Sharma, a Mumbai-based financial analyst, received a convincing Amazon India security email in November 2024. The professional-looking message warned of “suspicious activity” and urged immediate account verification. Within minutes of entering her credentials on the fake website, cybercriminals had hijacked her account, changed her delivery address to Dubai, and ordered electronic gadgets worth Rs. 80,000 using her saved payment details. The electronics were shipped internationally through Amazon’s legitimate system before Anushka even noticed.
What is the modus operandi?
- Phishing emails from Nigeria harvest Indian customer credentials
- Account takeover allows address changes to international locations
- Fraudulent orders use victims’ saved payment methods
- Legitimate shipping delivers stolen goods to criminal networks abroad
- Quick resale in local markets before victims detect fraud
The jurisdictional nightmare
- India: “Criminals abroad, goods delivered internationally; outside jurisdiction”
- Dubai: “Products delivered to legitimate addresses, recipients claim legal purchase”
- Nigeria: “Phishing servers anonymised, individuals unidentifiable”
- Amazon: “Transactions authorised with customer credentials, shipping completed as requested”.
Now you know why cracking cross-border cases is nearly impossible. Evidence is scattered across multiple countries, legal cooperation requires 12-24 months per jurisdiction, money is laundered through cryptocurrency within hours, and individual cases lack resources for international pursuit.
Authorities to approach if you are a victim of e-commerce fraud
How to file a complaint to the authority?
A. Platform-level complaints
Most legitimate e-commerce platforms have internal dispute resolution mechanisms that work faster than external legal remedies.
Step-by-step process:
- File a complaint through the platform’s grievance portal
- Upload supporting evidence (screenshots, payment proof, communication records)
- Request specific remedies (refund, replacement, compensation)
- Escalate to the platform’s appellate authority if unsatisfied
- Document all responses for potential legal action
Timeline: Most platforms resolve genuine complaints within 7-15 days under consumer protection regulations.
Tip: Always file platform complaints first because even consumer commissions often ask why internal remedies were not even attempted.
B. Consumer forum proceedings
Depending upon your claim amount, you either approach the consumer disputes redressal commission at a district level, state level or national level. And here is how you can do that.
- Online filing (recommended):
1. Visit edaakhil.nic.in
2. Register as a complainant
3. Fill online form with case details
4. Upload all documents (PDF format, max 2MB each)
5. Pay fees online
6. Submit and note the complaint number
- Offline filing: (when the digital infrastructure is not fully in place)
1. Visit the Commission office during working hours
2. Submit complaint in triplicate
3. Attach all documents in triplicate
4. Pay fees via DD/cash
5. Get acknowledgement with the complaint number
C. Cybercrime complaints
- National Cybercrime Reporting Portal
- Website: cybercrime.gov.in
- 24/7 online complaint filing
- Automatic routing to the relevant state police
- Real-time status tracking
- Integration with banking fraud alerts
- State Cyber Crime Cells:
- Direct investigation capabilities
- Asset freezing powers
- Cross-border coordination
- Technical evidence analysis
D. Criminal proceedings
When to file an FIR:
- The fraud amount exceeds Rs. 20,000
- Identity theft or data misuse is involved
- Organised fraud affecting multiple victims
- The platform refuses to cooperate with refunds
What should be your strategy to draft a complaint against e-commerce fraud?
This topic has already been thoroughly covered in my earlier article, “Unmasking Investment Fraud: How to Spot One and Avoid Getting Scammed.” You can click on the ____ to read it in detail.
How AI and blockchain could transform e-commerce security
A. AI-powered security solutions
- Real-time fraud detection AI analyses transaction patterns and user behaviour to identify suspicious activities within milliseconds. Machine learning models achieve higher detection rates while reducing false positives significantly.
- Behavioural authentication AI creates unique user profiles based on typing patterns and browsing habits. This invisible authentication flags account takeovers without disrupting legitimate users.
- Intelligent risk assessment AI evaluates device fingerprints, location data, and purchase velocity to assign dynamic risk scores. High-risk transactions automatically trigger additional verification.
B. Blockchain security infrastructure
- Immutable transaction records: Blockchain creates tamper-proof transaction ledgers, eliminating payment disputes and providing definitive purchase proof.
- Smart contract automation: Self-executing contracts release payments when delivery conditions are met, protecting both buyers and sellers from fraud.
- Decentralised identity verification: Blockchain-based identity systems verify credentials without sharing sensitive data, reducing breach risks while maintaining privacy.
C. Synergistic benefits
- Enhanced supply chain transparency, AI tracks products through blockchain-recorded supply chains, detecting counterfeits and ensuring authenticity verification.
- Automated compliance monitoring: AI continuously monitors blockchain transactions for regulatory compliance, automatically flagging suspicious patterns for AML and KYC requirements.
- Predictive security intelligence: Machine learning analyses blockchain data patterns to predict emerging threats, enabling proactive security measures.
D. Implementation impact
- Cost reduction. Organisations report a 60% reduction in fraud losses and a 45% decrease in manual review costs through automated processes.
- Customer trust enhancement: Transparent, verifiable transactions increase customer confidence, showing 40% higher conversion rates on blockchain-verified platforms.
- Scalability and performance: Modern AI-blockchain architectures process millions of transactions per second while maintaining security standards.
A consumer’s digital safety checklist
Before making any online purchase, verify these essential elements:
Final thoughts
E-commerce fraud in India represents a rapidly evolving challenge that requires both individual vigilance and systemic legal remedies. The legal framework, while comprehensive, is still adapting to the sophisticated tactics employed by digital fraudsters.
For legal practitioners: This field offers significant opportunities as e-commerce disputes multiply and regulatory mechanisms strengthen. Success requires understanding both traditional consumer law and emerging digital regulations.
For consumers: The best protection combines careful pre-purchase verification with knowledge of available legal remedies. When fraud occurs, quick action and proper documentation significantly improve recovery chances.
For e-commerce platforms, Proactive fraud prevention and solid grievance mechanisms are not just legal compliance; they are business necessities in an increasingly competitive market where consumer trust determines success.
The most effective approach combines digital literacy, legal awareness, and immediate action when problems arise. In India’s booming e-commerce landscape, your rights as a consumer are protected by law, but only if you know how to exercise them.
As online shopping becomes even more integral to daily life, the question is not whether you will encounter e-commerce issues; it is whether you will be prepared to protect yourself and seek appropriate remedies when needed.
FAQs
1. Can I get a refund if I simply don’t like a product I ordered online?
Yes, under the Consumer Protection (E-commerce) Rules 2020, you have the right to return products within the stated return period. However, the seller can deduct reasonable handling charges for non-defective returns.
2. What if an e-commerce platform shuts down after I have placed an order?
File immediate complaints with the cybercrime portal and the consumer commissions. If you paid by credit card, initiate a chargeback.
3. Are “no questions asked” return policies legally binding?
Yes, if advertised prominently. Platforms cannot later impose conditions not disclosed at the time of purchase. Such practices constitute unfair trade practices.
4. Can I file a case if I receive a counterfeit product from a marketplace?
Yes, you can file against both the seller and the platform. Recent judgments hold platforms liable for adequate seller verification and product authenticity.
5. What is the time limit for filing e-commerce fraud complaints?
- Consumer forums: 2 years from the date of the deficiency in service
- Cybercrime complaints: File immediately for best evidence preservation
- Credit card disputes: 60 days from transaction date
- Criminal complaints: 3 years from the date of fraud discovery
6. Can platforms legally charge “convenience fees” not disclosed upfront?
No, all charges must be disclosed before payment confirmation. Hidden charges constitute unfair trade practices under the Consumer Protection Act 2019.
7. Can I claim compensation for mental harassment caused by e-commerce fraud?
Yes, consumer forums award compensation for mental agony in fraud cases. Awards typically range from Rs. 10,000 to Rs. 1 lakh, depending on the severity of harassment and financial impact.
8. What if the fraudulent seller used my referral code to scam others?
You are not liable for others’ losses, but cooperate with investigations. Document that you were also a victim and did not knowingly participate in the fraud. Consider filing your complaint to establish your victim status.
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