On the afternoon of August 17, Mahesh stepped out of the exam hall at Modern Secondary School in Bhaktapur, exhausted but relieved after completing a gruelling three-hour MBBS entrance exam.

As he exited the gate, his first instinct was not to call his family with the good news, but rather to reach out to someone saved in his phone contacts as ‘Flat Owner.’ For the next ten minutes, Mahesh, who the Post is identifying with a pseudonym for privacy reasons, stood by the school gate, repeatedly dialling the number with no success.

This was not just another phone call—it was a desperate attempt to recover the Rs20,000 he had been scammed out of in a flat rental fraud.

Mahesh’s ordeal began two months ago when he began looking for affordable housing in Kathmandu. He planned to move in with four friends after finishing his exams and came across an enticing offer through WhatsApp: a three-room flat in New Baneshwar for just Rs8,000 a month.

Initially sceptical, Mahesh was eventually persuaded by the purported landlord, who even sent videos of the furnished apartment. However, by the time Mahesh arrived in Kathmandu, having paid the full advance of three months’ rent plus additional security charges, the flat owner has been completely contactless.

“I feel frustrated and ashamed,” Mahesh says. “My parents are farmers, and we’re just a middle-class family. I don’t know how to tell them or my friends that I lost their money.”

Mahesh’s frustration is not unique. In recent years, the number of people who have fallen prey to scams carried out via online mediums, including hacking and cyber harassment, is on the rise.

Data from Nepal’s Cyber Bureau shows that in the fiscal year 2022-23, a total of 9,013 cybercrime cases were reported. Out of these, 1,835 were related to online fraud, accounting for 20.35 percent of the total cases. In 2023-24, the number more than doubled, skyrocketing to 19,730. The surge in online fraud cases is equally concerning, with 4,112 cases registered, making up 20.84 percent of the total.

The data reflects an alarming trend that shows no signs of slowing down. In fact, the current fiscal year 2024-25 has already seen 2,100 cases registered within the first month. And on the face of it, Nepal appears critically ill-prepared to tackle the growing challenges of cyber threats.

According to Superintendent of Police Deepak Raj Awasthi, spokesperson and information officer of the Cyber Bureau, the highest crimes are related to hacking, which now accounts for around 52 percent of the total cybercrime cases. “Cybercrime cases are increasing at a very fast rate, but our resources to solve the problem haven’t improved much,” says Awasthi.

The bureau remains woefully understaffed and underfunded. Out of the 106 personnel at the Cyber Bureau, only 28 are dedicated to the IT department tasked with solving cases.

On June 26, 2023, the Ministry of Law, Justice, and Parliamentary Affairs issued a notice in the Nepal Gazette, outlining plans for cyber-related crimes to be addressed in all districts.

But the lower-level courts across districts are struggling to manage these cases due to a shortage of specialised technical expertise, certified professionals, and trained personnel.

As a result, most cases across the country continue to be transferred to the Cyber Bureau at Bhotahity, straining its already limited resources.

In a press release dated August 18, the Cyber Bureau warned the public about the increasing misuse of digital platforms, including the use of artificial intelligence (AI) to create and spread misleading or harmful content. The notice, while informative, highlights the growing challenges in policing cyberspace—a space that is becoming increasingly hostile for the unwary.

According to the bureau, one of the biggest challenges in addressing the surge in cybercrime is the lack of budgetary resources. Another is their inability to trace the groups responsible for online fraud and scams for a lack of necessary investigative tools and resources to determine where and to whom the data collected through fraudulent apps is being transmitted, making it difficult to identify the root source of these crimes, Awasthi says.

He also emphasised that the current IT department staff is insufficient. With the growing use of AI, cryptocurrency, and deepfake technology, IT and human resources must be equipped with the necessary skills and investigative tools to tackle the rising number of cases.

“There needs to be an update in laws and policies to deal with cybercrime cases,” says Awasthi. “Currently, we operate under the Electronic Transaction Act, but we urgently need specific legislation that categorises different types of cybercrimes. Our IT department also needs more personnel, better training, and access to advanced investigative tools.”

While cases involving AI are still categorised under morphing, Awasthi acknowledges that AI-driven scams are of growing concern. “We’ve encountered instances where perpetrators use apps with built-in AI, but we haven’t yet seen direct use of advanced AI software,” he says. “However, it’s only a matter of time before these cases become more prevalent.”

The most common platforms for online fraud in Nepal have been Telegram and WhatsApp, with Telegram leading in reported cases. Investment scams, lottery scams, and romance/sex scams are among the most prevalent, with investment scams being the most reported.

The Cyber Bureau’s website lists several common scams, including flat rental frauds like the one that ensnared Mahesh. These scams often involve asking for an advance payment for a room or flat, after which the scammer becomes unreachable. Other scams include online shopping fraud, employment fraud, and inheritance scams.

In January 2024, Nepal had 15.40 million internet users, with an internet penetration rate of 49.6 percent of the total population, according to DataReportal. As Nepal’s digital landscape continues expanding so do the risks of cybercrime, as shown by reports from the Cyber Bureau.

The gap between the escalating cyber threats and Nepal’s limited resources and preparedness is a critical risk to the country’s future digital security and literacy.

Awasthi also suggests that establishing well-equipped and well-resourced mechanisms would alleviate the pressure on the Nepal Cyber Bureau in Kathmandu, making it easier to manage the growing number of cases across the country. “We’re doing our best with the resources we have,” he says. “But it’s clear that we need to expand our capabilities to keep up with the evolving threats in cyberspace.”