The increasing risk of a mule account: when fraudsters use your bank account.

A few days ago, Jammu and Kashmir cyber police claim to uncover a racket of thousands of fraudulent bank accounts, referred to as mule accounts. In a recents crackdown, during a press conference in 2025, officials claimed that they have found 7,200 of such accounts, but their estimates suggesting number can reach 30,000. Then, why should the ordinary citizens be worried? Because 'these mule account can lead them to cyber scams-and even invite legal consequences.

Cybersecurity specialist Arya Tyagi shared two real incidents. An engineering student from Noida received a call about a work-from-home job. While he was not interested in paying Rs 8,000 towards registration, he accepted a second offer in the finance department to help in manging transactions. Soon, he was asked to use his own bank accounts to receive money and distribute it to various other accounts. He earned Rs 3,000 a day till his accounts were flagged and frozen as mule accounts. In another case, a villager from Haryana was entrapped by a scammer claiming to provide trading tips. The scammer gained accessed his bank account and used it for fraud. When a women complained of being scammed, the unsuspecting villager found himself in the place of the actual culprit.

Indiaexpress.com spoke to Ankush Mishra and Tyagi, who are also in depth interviews with the deputy superintendent of police of cyber/Special Task Force, Dehradun, in detail, to understand how mule accounts worked and why they're so risky.

According to Ankush Mishra, the two most significant terms involved are: 

Shell Companies: They exist only in the books of accounts. They are totally legitimate but have no operation. These shell companies are opened account which conceals the illegal activity.

Mule Accounts: Just like a mule carries a load, this account takes the stolen money from one wallet to another. The account holder either be ignorant of it or he may actually give his identity for a few sums.

"When this helpline, 155260 (now replaced by 1930) for reporting cybercrimes in india, was launched, the authorities got an ability to freeze accounts quickly, where scam money was credited, quickly. Thereafter, the scammers adapted, routing stolen money through mule accounts to make detection harder," Tyagi said.

Types of money mules are: 

1. Unwillingly victimized: Many people fall victim but do not know that they were tricked into sharing Aadhaar or PAN details under the guise of some fake government schemes. Those would open a person's account without knowledge.

2. Willing participants: Selling their access to their bank accounts for minor commissions.
Initially, scammers targeted the daily wage earners, the rickshaw drivers, and residents of slums, promising them between Rs. 500 and Rs. 3,000 to open accounts; 'Many of them, due to limited in education and awareness, just agreed, unaware their names were being used in financial crimes,' Tyagi said.

Currently, the students are used as they are promised a 2 percent commission on monthly transactions in return for granting access to their accounts. 

This is how it work with fraud:  

When it occurs eventually, police catch track of the account to where the money landed, thus catching account holders. Most of the mule account cases usually involve the individual whose name appears with the account being a victim too, their account gets frozen by the cyber police, and they lose access to their own money," said Tyagi.

The real scammers remain hidden. It is the account holder who gets traced and loses money in the end, "Mishra said. These "agents" by using Telegram channels or personal networks recruit the potential money mules, according to the report from CloudSEK's Threat Intelligence Team. These agents act to run successful bustling businesses needing help manage large transactions. In 2023, CloudSEK continued its investigation and uncovered a network of money mules, posing a severe risk to the Indian Banking ecosystem. The report discusses a malicious mobile application (APK) that serves as a key tool for on-boarding and managing these money mules.

What if someone do to protect themselves?

Report: If you believe that your PAN card or Bank Account is being misused, file a complaint right away. The police will be able to warn the bank and do what needs to be done so that no further damage is caused.

1. Do not share your personal and bank details with anyone including family members, espicially bank account details, PAN card and Aadhar details.

2. Do not accept payments from or send money to such unknown people: likely, the victims are not able to identify the nature of money, as it was acquired through sources. 

A mule account is a perfect example of how such an unsuspecting citizen is so easily turned into victims and sometimes into unintentional accomplice.

Source: https://indianexpress.com

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