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Karnataka CID busts mule account distribution ring, 13 held
CID arrested 13 for creating mule bank accounts used by cybercriminals to transfer stolen money, identifying over 42,000 such accounts in a major operation
The state police’s Criminal Investigation Department (CID) has arrested 13 people for allegedly running an operation to create and sell mule bank accounts to cybercrime gangs, which were then used to move stolen money, senior police officers aware of the matter said.
The raids were launched by the CID’s Cyber Crime Wing on Thursday and spanned over 100 locations across the state, including Bengaluru, Koppal, Hubballi, Belagavi, Mangaluru and Ballari, added officers. Investigators said they identified over 42,000 mule accounts in the course of the operation.
Explaining the mechanism, cyber expert and former police inspector BK Poovaiah said, “A mule account is a bank account that is opened or lent by an innocent person to cybercriminals for a small commission. These accounts are used to receive, transfer and withdraw money stolen through online frauds. Criminals avoid using their own identities and instead misuse accounts of students, unemployed youth or senior citizens. The account holder often believes he is helping someone, but legally he becomes part of the crime chain. Sharing OTPs, ATM cards or internet banking details can turn any ordinary citizen into a money mule. Awareness and caution are the best protection against this abuse.”
According to CID ADGP Pronab Mohanty, “We have been closely monitoring the growing misuse of bank accounts for cybercrimes. This operation was planned after months of technical surveillance and field investigation. The raids have helped us dismantle a major network that was enabling large-scale online fraud.”
Investigators say the accused acted as suppliers in the fraud ecosystem, gathering bank account details, ATM cards and online banking credentials from people in exchange for small payments.
Those accounts were then passed on to cybercrime groups to receive and disperse money taken from victims, they added.
“Most of the account holders had no idea that their bank details were being misused. The accused exploited their ignorance and financial vulnerability. These mule accounts were used to transfer illegal funds and withdraw cash through ATMs,” an officer involved in the probe said.
Police said that the 13 people in custody were suspected to serve as key links connecting local account holders with interstate and international syndicates. Early findings suggest that victims across India may have lost crores of rupees through transactions routed via these accounts.
“Our teams are now analysing transaction trails to identify the ultimate beneficiaries of the crime,” CID SP MD Sharath told reporters.
The operation follows a surge in complaints of digital fraud in recent months.
Officers said criminals have increasingly avoided using their own identities, instead relying on accounts opened in the names of students, unemployed youth and other financially vulnerable people.
“This trend of using mule accounts has become one of the biggest challenges in cybercrime investigation. By targeting the supply chain of such accounts, we are striking at the root of the problem,” another officer involved in the probe added.
During the searches, teams seized mobile phones, SIM cards, debit cards and documents related to bank accounts. Digital material recovered in the raids is being examined for evidence of wider links, including possible connections to foreign-based cybercriminals.
