A fake telephone server exchange that cost the Department of Telecommunications a loss of nearly Rs 7 lakh per day, allowing users to make international calls at local rates in the Moradabad district, has been busted. The Moradabad police, in a joint operation with BSNL officials, have busted the racket being run in Transport Nagar area, officials said. The main accused, identified as Owais Alam Malik, along with two other gang members --Pushpendra and Pawan Kumar -- have been arrested from Noida's Sector 62. The police had found a fake exchange in Noida, and during investigation, they learnt that Malik was running a similar set up from his house in Moradabad.