New Delhi, April 30 The Secretary, Department of Financial Services (DFS), on Thursday instructed banks to adopt the MuleHunter.AI tool developed by the Reserve Bank of India at the earliest to timely identify and prevent mule accounts involved in financial cyber frauds.
The Secretary chaired a meeting with the Commissioner of Police, Hyderabad, and senior officials from the Indian Cyber Crime Coordination Centre, the Central Bureau of Investigation, the Reserve Bank of India, the Indian Digital Payments Infrastructure Company, and banks to review digital financial frauds and the increasing use of mule accounts by cybercriminals.
The discussion focused on ‘Operation Octopus’ recently carried out by the Hyderabad Police and the learnings that emerged from it. It was emphasised that coordinated efforts should be strengthened to combat cyber-enabled financial fraud and enhance customer protection, DFS said in a post on 'X'.
The meeting emphasised closer collaboration among law enforcement agencies and banks, real-time intelligence sharing, and faster response mechanisms to detect and prevent digital financial fraud under Operation Octopus. Secretary, DFS, also advised State Level Bankers’ Committees to sensitise State Police Authorities about the steps taken by banks to prevent cyber financial frauds and to undertake greater public awareness initiatives.
Meanwhile, Hyderabad Police Commissioner V. C. Sajjanar posted on 'X' that Secretary, DFS, chaired a high-level meeting with officials, including himself, in New Delhi to review Hyderabad Police’s recent crackdown on mule accounts under ‘Operation Octopus’.
The discussion centred on key learnings from the operation, with a focus on strengthening coordinated efforts to tackle cyber-enabled financial frauds and enhance customer protection, the Commissioner said.
Sajjanar had last week suggested critical changes to the banking system, stating that such reforms are imperative to dismantle organised syndicates operating across the country.
In a detailed letter addressed to Reserve Bank of India Governor Sanjay Malhotra, the Commissioner highlighted how 'mule accounts' created in the names of innocent individuals have become the focal point of cyber fraud.
These revelations surfaced during the high-profile 'Operation Octopus' investigation by the city police, which exposed critical systemic vulnerabilities and gross negligence in Know Your Customer verification processes at the branch level.
The Commissioner urged the Reserve Bank of India to issue stringent directives to all commercial banks, requiring them to hold branch-level officials accountable, and recommended an immediate systemic audit to ensure the field-level implementation of Know Your Customer guidelines.
--IANS
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