Daijiworld Media Network – Srinagar

Srinagar, Feb 15: In a major crackdown on cyber-enabled financial crimes, security agencies have unearthed a fast-growing network of “mule accounts” operating across Jammu and Kashmir, allegedly serving as the financial backbone of international scam syndicates. Officials suspect that funds channelled through these accounts may eventually be diverted to separatist or anti-national activities, reported.

Over the last three years, authorities have identified and frozen more than 8,000 such accounts in the Union Territory, exposing an intricate web of laundering operations. Investigators said these accounts play a crucial role in converting stolen funds into hard-to-trace digital assets, including cryptocurrency.

In view of the alarming trend, central agencies have instructed the Jammu and Kashmir Police and other enforcement bodies to intensify coordination with banks and financial institutions to prevent the further spread of mule accounts and tighten transaction scrutiny.

Officials revealed that after the National Investigation Agency launched a crackdown in 2017 on illegal financial inflows into the region, anti-national networks appear to have adapted swiftly. Instead of depending on conventional hawala channels, they are now believed to be operating through what agencies term a “digital hawala” system.

Under this revamped model, commissions earned by mule account holders and intermediaries—known as “mulers”—are suspected to be siphoned towards activities detrimental to national security.
Though mulers do not directly approach scam victims or circulate fraudulent links, their role is considered pivotal. They recruit and manage a pool of mule accounts, which scam operators use to receive and circulate stolen money while masking their identities.

Many of the accounts belong to unsuspecting individuals lured by promises of easy money. They are persuaded to hand over full banking access, including online credentials, under the pretext that their accounts will be temporarily used as “parking accounts.” In reality, these accounts become channels for laundering cyber fraud proceeds.

Investigations indicate that a single scam operator may control anywhere between 10 and 30 mule accounts simultaneously. In some cases, shell companies are floated to open bank accounts, allowing high-value transactions—sometimes up to Rs 40 lakh in a single day—without triggering immediate red flags.

Funds are rapidly shuffled across multiple accounts and broken into smaller amounts to evade detection systems.

Security officials stressed that even if mule account holders are not masterminds behind scams, they remain complicit in money laundering by knowingly renting out their accounts for commissions.

“The entire scam ecosystem rests on these accounts. Without them, the fraud collapses at the very first step. Those leasing out their accounts are not passive bystanders—they are enabling the crime,” a senior official was quoted as saying.

A detailed study by central agencies has further revealed that handlers operating from countries such as China, Malaysia, Myanmar and Cambodia are allegedly guiding recruits in Jammu and Kashmir to create private cryptocurrency wallets, underlining the global dimensions of the racket.