On Monday, WhatsApp refuted before the Apex Court the allegations that it’s payment services system wasn't secure & reliable & can be hacked by Israeli spy software ‘Pegasus’.

The ‘Pegasus’ issue was referred by Senior Lawyer Krishnan Venugopal, appearing for Rajya Sabha MP Binoy Viswam, who has filed a petition alleging breach of financial data security of Indians using ‘Unified Payments Interface’ (UPI) services by Amazon Pay, GooglePay & others.

A bench headed by CJI SA Bobde referred to Venugopal’s submission & told Senior Lawyer Kapil Sibal, who was appearing for WhatsApp, that a serious allegation was made against WhatsApp that it can be hacked.

The Bench said that “Krishnan Venugopal has made a serious allegation that your system (WhatsApp) can be hacked by something called ‘Pegasus’".

Sibal, while denying the allegations, said, “Absolutely baseless. There is no such pleading (in the writ petition). It is just an oral submission made across the bar without basis.”

Venugopal also asserted that another issue in the case was data localisation.

Venugopal said that “Problem with WhatsApp, Amazon & Google is that when they allow payment to happen & data goes abroad. Critical financial data is allowed to be accessed by companies abroad & RBI justifies it. This is a violation of privacy judgment as my data is being grossly misused as these companies then collect this data & use it for advertisement purposes".

He added that all the data is being shared with the parent companies in violation of the National Payments Corporation of India (NPCI) guidelines.

Venugopal further disputed that “The data is being processed by the infrastructure of the parent company. The RBI has allowed WhatsApp, even when the case is pending before the court, to go ahead & share this data with companies like Google, Amazon, Facebook, etc without any circular or formal regulation".

After a brief hearing, the Supreme Court posted the matter for further hearing in Jan.

The bench was hearing a Public Interest Litigation filed by Viswam, a Communist Party of India (CPI) leader, who has alleged breach of financial data security of Indians using UPI services offered by big players like Amazon Pay, GooglePay & challenging the permission to WhatsApp to start UPI services.

The petition also sought directions to the RBI for framing regulation to ensure that data collected on UPI platforms are not “exploited” or used in any manner other than for processing payments.

On Oct 15, the Supreme Court had sought responses from the Central Govt, RBI, National Payments Corporation of India (NPCI) & others including Google Inc, Facebook Inc, WhatsApp & Amazon Inc on the petition.

Viswam has sought directions to the RBI & the NPCI to ensure that the data collected on UPI platforms isn't shared with their parent company or any other third party under any circumstances.

The plea stated, “In India, the UPI payments system is being regulated & supervised by RBI & NPCI, however, the RBI & the NPCI instead of fulfilling their statutory obligations & protecting & securing the sensitive data of users are compromising the interest of the Indian users by allowing the non-compliant foreign entities to operate its payment services".

“The RBI & NPCI have permitted the three members of “Big Four Tech Giants’, Amazon, Google & Facebook/WhatsApp (Beta phase) to participate in the UPI ecosystem without much scrutiny & in spite of blatant violations of UPI guidelines & RBI regulations,” it added.

The plea alleged that this conduct of RBI & NPCI put the sensitive financial data of Indian users at huge risks, especially when these entities have been “continuously accused of abusing dominance & compromising data”, among other things. 

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