EXPLAINER: How do cybercriminals use mule accounts to launder money obtained through fraud?

With 91 suspected accounts allegedly involved in large-scale online fraud across different banks in the state, the Haryana Cyber Crime Police have intensified investigations into cyber fraud cases registered at various police stations in Haryana. Out of these accounts, 12 mule accounts were traced to Kotak Mahindra Bank’s Sector-12 branch in Karnal. One of the accounts, opened in the name of a fruit and vegetable trading business, recorded suspicious transactions worth more than Rs 5.7 crore within just six months. At least 14 complaints linked to this account were registered on the National Cyber Crime Portal (NCRP). The police suspect such accounts are used to transfer money.

What is cybercrime?

Cybercrime refers to illegal activities involving computers, networks, or digital devices. It includes hacking, phishing, cyberstalking, payment fraud, and identity theft. Cyber fraud is a subset of cybercrime that uses deception to steal money or data. In “digital arrest” cases, the fraudsters use fear tactics, falsely claiming that victims are involved in serious crimes such as money laundering, drug trafficking, or forgery. To “resolve” these fabricated charges, victims are forced into lengthy online calls and eventually coerced into transferring money. However, as per the authorities, there is no legal provision for digital arrest. In some cases, fraudsters also use SIM boxes — devices that can hold hundreds of SIM cards — to make simultaneous calls and cheat multiple people at once.

What is a mule account?

A mule account is a bank account used by criminals to launder illicit funds. It may be opened using fake documents or stolen credentials. Money is routed through such accounts before being moved elsewhere mostly abroad, making tracking and recovery difficult. In Haryana, the police found that several mule accounts were opened using identity documents of others. Some account holders projected themselves as small traders to avoid suspicion. Leaked Aadhaar details and personal credentials on the darknet are often misused by the fraudsters to obtain SIM cards, open accounts, and run scams in victims’ names.

Where can victims report cybercrime?

Victims should dial the National Cyber Helpline at 1930 or file a complaint on the National Cyber Crime Portal.

What steps are the Haryana police taking?

The cybercrime police are tracing mule accounts, arresting operatives and enhancing forensic investigations. Haryana is among the top states in blocking mobile numbers involved in cybercrimes and freezing such accounts. The state is also among the best performers in arresting cybercriminals with the support of telecom companies. At a recent meeting held at the Haryana Police Academy, Madhuban, DGP Shatrujeet Kapur praised the police teams for their investigation but stressed the need to improve the recovery rate of defrauded money. He directed them to take strict action, dismantle networks and restore citizens’ confidence.

What common types of cyber fraud should people watch for?

Phishing emails or calls, fake investment schemes, payment fraud using stolen cards, business email compromise and identity theft.

How can people protect themselves from cyber fraud?

People should avoid sharing OTPs, PAN, or Aadhaar details, verify callers, never transfer money under threat, and use secure passwords. They should report suspicious activity immediately with the police. A senior police official advises people not to sell their account on commission basis, which has been noticed in several cases so far.