Cybercrime – Agencies Freeze 8,000 Mule Accounts in J&K Crackdown
Cybercrime – Security forces have uncovered an extensive network of so-called mule accounts operating across Jammu and Kashmir, raising concerns that illicit funds routed through these accounts may have been used to support separatist activities and other unlawful operations in the Union Territory. Over the past three years, more than 8,000 such bank accounts have been identified and frozen as part of a coordinated crackdown.
Shift to Digital Channels After Financial Surveillance Tightened
Officials familiar with the investigation say the pattern of illegal financial transfers evolved after earlier enforcement actions disrupted conventional funding routes. Following stricter scrutiny of suspicious transactions several years ago, investigators believe certain groups began adopting more sophisticated digital methods to move money discreetly.
The suspected system operates in a manner similar to digital hawala networks. Stolen funds, often generated through international online scams, are allegedly passed through multiple intermediary accounts before being converted into cryptocurrency. This layered process makes the money trail difficult to track and complicates recovery efforts.
Authorities suspect that the network served as a financial conduit for global cyber fraud syndicates. By breaking large sums into smaller transfers and distributing them across various accounts, the operators attempted to avoid detection by banks and financial monitoring agencies.
Coordination With Banks to Identify Middlemen
Central agencies have instructed the Jammu and Kashmir Police and other investigative bodies to strengthen coordination with banks and financial institutions. The objective is to prevent the rapid spread of such accounts and identify individuals who allow their bank details to be used for illegal transfers. These intermediaries, commonly referred to as “mulers,” are often recruited to open or operate accounts in exchange for commissions, without fully understanding the scale of the criminal operations involved.
Investigators note that tracking these transactions requires rapid response and close collaboration between law enforcement and banking authorities. Once funds are moved into private digital wallets or converted into cryptocurrency, recovery becomes significantly more challenging.
Complex Money Trail Designed to Evade Detection
According to officials, the money trail in mule account cases is deliberately structured to confuse investigators. Funds are transferred swiftly across several accounts, split into smaller amounts, and then redirected through additional layers before reaching their final destination. In many cases, the money is converted into crypto assets using private wallets, making traditional tracing methods less effective.
Security agencies say this approach not only enables cybercriminals to conceal the origin of funds but also reduces the likelihood of triggering automated fraud alerts within the banking system.
Recent Fraud Case Highlights Swift Police Action
A recent cyber fraud investigation in Jammu and Kashmir illustrates both the scale of the threat and the importance of timely intervention. In a case involving a retired Air Force officer who was targeted in a digital arrest scam for nine days, fraudsters allegedly siphoned off Rs 52 lakh.
Police were able to recover nearly Rs 40 lakh of the amount after tracing the beneficiary accounts and following the transaction trail through multiple financial layers. Officials said that within three hours of receiving the complaint, investigators identified Rs 11.90 lakh transferred to a suspected account in Jodhpur linked to a private bank.
Further examination uncovered an additional Rs 28 lakh routed through a second set of accounts. Authorities immediately placed these funds on hold by invoking newly issued standard operating procedures designed to respond quickly to cybercrime complaints.
Ongoing Monitoring and Preventive Measures
Security agencies have indicated that monitoring efforts will continue, with a focus on dismantling networks that facilitate financial fraud and illegal fund transfers. Banks have also been advised to enhance due diligence processes and strengthen internal compliance mechanisms to detect suspicious activity at an early stage.
Officials emphasize that public awareness remains a critical factor in curbing cyber fraud. Prompt reporting of suspicious transactions significantly improves the chances of freezing funds before they are dispersed across multiple accounts or converted into digital assets.