Stash away your PAN card

A friend of my mine was robbed by his flat-mate. That guy with whom he was sharing his apartment simply walked away with his phone and emptied his ATM cards.
A detailed account of the incident can be found here.
After being pick-pocketed of 2 phones, I have realized that most thieves find that most valuable item on the target is the phone. By habit people keep track of their wallet bearing back-pocket, but in reality it contains only a few hundred bucks. While a high end phone is worth INR 30-40k. (More after the current Congress govt. has rendered INR worthless)
However this thief was ingenious. Few interesting points this incident raised were:
1. Although he clearly had access to the laptop. He resists the temptation to flick it. Clearly proving that like TV refrigerators laptops are too cumbersome to move in the black market.
2. PAN card: A PAN card is like the social security number and has all the information needed for any banking transaction. You quote your PAN number, address, date of birth and mobile number and you get keys to Fort Knox. Together they have all the information needed to change your banking passwords and max out your cards.
3. In India where people lack identity proofs, PAN is being extensively used by bulk of the people as identity proofs. If you don’t believe me, wait at the airport security. Every second Indian flashes out their PAN card as identity proof. Net result that they end up carrying this card in their wallet always. Making it easier for thieves to get access to your PAN number and date of birth (2 most frequently asked security questions by most banks)
4. Popular wisdom teaches that one should not carry a lot of cash because they would lose more. But with multiple credit cards & debit cards most targets become walking Lakpati (rich marks). In 10 minutes through multiple swiping & ATM withdrawals one cost lose their bank balance & get the credit cards maxed out.
Remedy: Limit your losses!
1. Don’t carry your PAN card around. If you have a driver’s license use it.
2. Don’t buy a flashy high end phone. And if you do, have at least simple password to safeguard the thief from accessing your personal/private photographs.
3. Keep 2 ATM cards. One for your savings and lock that one in a safe place and the second for your monthly expense which you carry around as everyday plastic & petty cash needs
4. Don’t carry multiple cards or credit cards with huge credit limits.

RIL embezzlement

I was surprised to hear about fraud and embezzlement accusations that have been raised against reliance group of companies (both Mukesh and Anil) recently.

The most celebrated one being the 51 page report from the Canadian research firm Veritas analyzing Reliance Communications and RIL. He has highlighted various instances (with factual data) of accounting fraud and suspicious issue of share/ownership. Please google and try to go through a copy of this report. (I don’t have distribution rights)

Then Firstpost (TV 18) took a dig against Reliance Ports and Terminals (RPTL) and Reliance Gas Transportation and Infrastructure (RGTIL). Both firms are privately owned and have a bare minimum equity capital of 5Lakhs (lowest possible as per govt regulations). Yet for their operations they have secured over 3,500 Crore debt (and bank guarantees) from RIL. Also not to mention lucrative long term contract with RIL to ensure steady revenue. Hence effectively all the risk of ownership/non-performance is transferred to RIL while the gains would be cornered by Mukesh (who has invested a bare minimum 5 Lakhs into the company).

Have you ever wondered why all of a sudden everybody is after Reliance?

Well answer is simple Reliance Industries was founded with almost no capital from its legendary founder. Over the years through IPO/FPO, mergers, convertible debentures (both public and private) the equity base has grown substantially. So the only way the promoters could preserve their ownership and position in the board was by secretly and clandestinely issuing shares to itself and almost zero costs.

Interestingly most people are aware of this fact, but till recently they did not care. Simply because, RIL traditionally made a lot of money for its common stock holders. So who cares how much the Ambanis make as long as you were getting more than you had dreamed off. However over the past 10 years the stock has consistently under-performed and Ambanis haven’t stopped fudging their books of accounts. Hence the public outrage.

BTW if you still believe that there is some element of truth in Reliance’s financial statements, then consider this:

One of the basic elements of corporate governance is having your books scrutinized by independent auditors. Although Satyam and PWC fiasco has proved that even the Big 4 auditors are not entirely an unbiased and shareholder friendly, but still Reliance has taken it totally different extremes.

Reliance auditors work *exclusively* for RIL and till recently operated out of Reliance Industries’ premises.

Don’t believe me, then check out: http://www.cas.ind.in/clients.html and http://www.rajendraco.com/aboutus.htm These auditors need to work hand in hand with the promoters in order to bring food to the table.

 

Credit Card theft

A friend of mine was a victim of online credit card. Someone used his credit card information to purchase airline tickets online.

This is the advice I gave him.
1. Call the Credit Card Company and block the Credit Card: After verification this process should take 30 seconds and no credit card company can legally ask you questions or try to sway your mind.
2. Then ask them to email/courier you the Credit Card Fraud Form and try to gather as much information as possible about that transaction. (There was one case in which on my ad-on card, my brother made a transaction that he had no recollection of. Hence querying of such details can prevent any such embarrassment)
3. Many good credit cards have a in build fraud protection insurance/scheme. Check the website/documents of any such scheme.
4. Check with the merchant. Usually they help willingly. However if they show reluctance, threaten then with a Credit Card Dispute.
According to investopeida
” This law allows consumers to withhold payment on poor-quality, damaged merchandise or incorrectly billed items they bought with a credit card until the matter is resolved. ”
Basically any merchant understands that once a dispute is called, he would have to spend a lot of time in documentation and legal hassles. Whats worse is that the Credit Card Company will charge the merchant for all the processes at its end and might even blacklist the merchant.
There is often a chance that the merchandise was not shipped, or the travel not made. In those cases timely action limits the damage caused and might also help in nabbing the culprit.
5. Deduct the wrong transaction and Clear all the remaining credit card outstanding, billed and unbilled. This demonstrates the genuineness of your intention and helps to sway the authorities to give a ruling in your favor.