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Illegal phone exchanges mushroom in India
Thursday, 09 September 2004, 19:30 IST
NEW DELHI: India's state-run telecommunication firm is facing competition from an unlikely source -- illegal telephone exchanges, some 200 of which have been detected across the country over the past six years.
These illegal exchanges - operated from little cubicles or private residences or shops -- are causing huge losses to the government, some estimates putting the figure at 
5 billion (500 crore) a year.
A senior Videsh Sanchar Nigam Limited (VSNL) said the first illegal exchange was detected in Mumbai in 1998. Since then over 195 such operations have been busted across the country.
In New Delhi, eight illegal exchanges were unearthed last year. The official said the exchanges bypassed the network of VSNL, which facilitates international phone calls in the country and gets a fixed commission from each incoming call made through its network.
Apart from causing financial losses to the exchequer, the illegal exchanges are seen as security threats.
Some time ago a foreigner was arrested in Kolkata on charges of running an illegal telephone exchange.
Delhi's Deputy Commissioner of Police (Special Cell) Ashok Chand told IANS: "In most cases the accused have been found to be businessmen trying to make fast money, but the illegal exchanges pose a security threat."
Explaining the modus operandi of the illegal exchanges, he said: "In most cases, the owners of illegal exchanges have a tie-up with (telephone) operators, mostly in the US and Europe. These offshore operators help customers call India at very cheap rates and issue pre-paid cards.
"The profit thus earned by cheating VSNL is shared by the local and foreign operators."
An official of VSNL's vigilance department said: "We recently unearthed two illegal exchanges in Punjab for which a non-resident Indian (NRI) based in New York provided the gadgets and technology for setting up exchanges.
"The NRI used to get a commission of 3 a minute on all calls made from America."
Delhi Police's Crime Branch recently unearthed an illegal exchange that was being run in the garb of a call centre. Investigations revealed the exchange had been operating for over a month and had caused losses running into millions of rupees.
The investigation revealed that the owners of the exchange were using 30 Integrated Services Digital Network (ISDN) lines.
"In the past month over 250,000 calls were made through these lines," said a police officer.
Police arrested Narender Paul, 35, and Kapil Gupta, 32, who ran the exchange in connivance with William Dean, a man who lived in Germany.
Another police officer said: "Dean apparently runs a cyber cafe at Munich. He struck a deal with a German telecom company and purchased their pre-paid international calling cards and agreed to route their calls to Delhi for which he was given 20 percent share of the total revenue collected."
The officer said Paul and Gupta bypassed authorised international long distance operators by routing calls through this exchange. Incoming international calls were received through a VSNL leased line.
"They were then transferred to users through legal telephone lines, resulting in huge losses of revenue," the officer said.
Source: IANS
5 billion (500 crore) a year.
A senior Videsh Sanchar Nigam Limited (VSNL) said the first illegal exchange was detected in Mumbai in 1998. Since then over 195 such operations have been busted across the country.
In New Delhi, eight illegal exchanges were unearthed last year. The official said the exchanges bypassed the network of VSNL, which facilitates international phone calls in the country and gets a fixed commission from each incoming call made through its network.
Apart from causing financial losses to the exchequer, the illegal exchanges are seen as security threats.
Some time ago a foreigner was arrested in Kolkata on charges of running an illegal telephone exchange.
Delhi's Deputy Commissioner of Police (Special Cell) Ashok Chand told IANS: "In most cases the accused have been found to be businessmen trying to make fast money, but the illegal exchanges pose a security threat."
Explaining the modus operandi of the illegal exchanges, he said: "In most cases, the owners of illegal exchanges have a tie-up with (telephone) operators, mostly in the US and Europe. These offshore operators help customers call India at very cheap rates and issue pre-paid cards.
"The profit thus earned by cheating VSNL is shared by the local and foreign operators."
An official of VSNL's vigilance department said: "We recently unearthed two illegal exchanges in Punjab for which a non-resident Indian (NRI) based in New York provided the gadgets and technology for setting up exchanges.
"The NRI used to get a commission of 3 a minute on all calls made from America."
Delhi Police's Crime Branch recently unearthed an illegal exchange that was being run in the garb of a call centre. Investigations revealed the exchange had been operating for over a month and had caused losses running into millions of rupees.
The investigation revealed that the owners of the exchange were using 30 Integrated Services Digital Network (ISDN) lines.
"In the past month over 250,000 calls were made through these lines," said a police officer.
Police arrested Narender Paul, 35, and Kapil Gupta, 32, who ran the exchange in connivance with William Dean, a man who lived in Germany.
Another police officer said: "Dean apparently runs a cyber cafe at Munich. He struck a deal with a German telecom company and purchased their pre-paid international calling cards and agreed to route their calls to Delhi for which he was given 20 percent share of the total revenue collected."
The officer said Paul and Gupta bypassed authorised international long distance operators by routing calls through this exchange. Incoming international calls were received through a VSNL leased line.
"They were then transferred to users through legal telephone lines, resulting in huge losses of revenue," the officer said.
Source: IANS