New Delhi/Srinagar, Feb 15: Security agencies have uncovered and frozen more than 8,000 “mule accounts” across Jammu and Kashmir over the past three years, exposing a vast money-laundering network linked to global cyber scams and raising concerns that routed funds could be diverted for separatist or anti-national activities, officials said.
Described as the most crucial link in cyber fraud chains, mule accounts enable criminals to move stolen money through multiple layers before converting it into untraceable cryptocurrency. Central agencies have now asked J&K Police and other law-enforcement bodies to coordinate with banks to curb the proliferation of such accounts and identify middlemen or “mulers” who supply them.
Officials believe anti-national elements may have shifted to this “digital hawala” model after the National Investigation Agency’s 2017 crackdown on illicit funding channels in the Union Territory. In this system, commissions earned by mule account holders can be siphoned for unlawful activities, they said.
Typically, mule accounts are opened or controlled by ordinary individuals lured with promises of easy commission and minimal risk. They hand over banking credentials under the pretext that their accounts will briefly serve as “parking accounts.” A single scam operator may use 10–30 such accounts, including those opened in the names of shell firms, allowing transactions of up to ₹40 lakh a day without immediate detection.
Investigators said the money trail is intentionally fragmented through rapid transfers and smaller transactions to evade monitoring. A central study also found handlers in China, Malaysia, Myanmar and Cambodia directing recruits in J&K to create private crypto wallets using VPNs to bypass KYC norms.
Authorities stressed mule account holders are active facilitators of laundering networks. J&K Police has already curbed VPN usage in the Valley, citing its exploitation by terrorists and separatists to avoid detection. (Agencies)
