INDIA Trends and Developments Contributed by: Nishant Joshi, Kunal Singh, Palash Bhatkoti and Vikalp Wange, Shardul Amarchand Mangaldas & Co.
extensive deployment of digital devices and means that directly linked to fake applications, phishing and fabricated documentary evidence (which characterise the crimes outlined above). The BNS, BNSS and BSA are designed to enable the Indian legal system to address the complex realities of modern-day financial crimes by filling gaps under the erstwhile laws, while also providing courts with the tools to ensure consistent prosecution of economic offences. III) Recognition of synthetically generated information (SGI) The growing capacity of technology to generate syn - thetic content, including fabricated audio, deepfake videos and manipulated images of persons or events that may never have occurred/existed has introduced a distinct dimension to financial crime. Criminals deploy such SGI to impersonate public officials, fabri - cate documentary evidence in digital arrest schemes, and create false scenarios designed to instil fear and extort money. Recognising the severity of this threat, India has introduced the IT (Intermediary Guidelines and Digital Media Ethics Code) Amendment Rules, 2026, which define SGI, regulate user awareness, and impose stricter intermediary due diligence and compliance obligations. Under these Rules, intermediaries that enable relevant modules are obligated to inform users of the impli - cations of hosting unlawful SGI, including liability to immediately disable access, remove contravening information, suspend or terminate user accounts, dis - close the identity of the violator and initiate criminal action under extant criminal statutes. IV) The Information Technology Act, 2000 (the “IT Act”) The IT Act remains a key instrument in addressing new financial crimes that exploit digital devices and computer resources. By criminalising offences like unauthorised access, data theft and identity fraud, to name a few, the IT Act
allows enforcement agencies to tackle cyber-enabled financial misconduct that traditional penal statutes were not designed to address. Its provisions relating to electronic records, digital sig - natures, and intermediary liability have strengthened both evidentiary and regulatory frameworks, enabling more effective investigation and prosecution of tech - nology-driven financial crimes. Penalties under the IT Act range from monetary fines to imprisonment, depending on the severity of the offence. As financial crimes have grown in both complexity and technological sophistication, the provisions of the IT Act are being invoked with increasing frequency by law enforcement agencies to facilitate investigations, secure electronic evidence and prosecute offenders/ perpetrators, thereby reinforcing the broader legisla - tive shift towards a legal regime that is equipped to confront the realities of modern financial crimes. V) The Prevention of Money Laundering Act, 2002 (PLMA) The PMLA provides a comprehensive legal framework for the identification, investigation and prosecution of offences involving proceeds of crime. Enacted with the objective of combating financial crime through the penalisation of money launder - ing, the PMLA empowers the Directorate of Enforce - ment (ED) (ie, the dedicated law enforcement agency constituted under the PMLA) to, inter alia, track illicit financial activities and attach and confiscate assets derived from the proceeds of crime. The PMLA assumes particular significance in the context of new types of financial crimes. As outlined above, schemes such as UPI fraud, digital arrest extortion, investment fraud, etc, invariably generate illicit proceeds of crime that are subsequently layered through complex transactions, crypto-assets and international wire transfers. The PMLA provides a legal basis for investigating and penalising such offences where there is involvement of, or a link to, money laundering, thereby extending
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