Highlighting the growing misuse of “mule accounts” and lapses in KYC processes following findings from the city police’s Operation Octopus investigation, Hyderabad Police Commissioner V. C. Sajjanar has written to the RBI seeking sweeping banking reforms to tackle cybercrime.
In a letter addressed to Sanjay Malhotra, Governor of the Reserve Bank of India, the Hyderabad Police Commissioner called for stricter accountability at the branch level and a comprehensive audit of KYC compliance across commercial banks. He noted that mule accounts, often opened using unsuspecting individuals’ credentials, have become central to organised cyber fraud networks.
The Commissioner pointed to systemic lapses uncovered during Operation Octopus, including collusion by bank staff. In one cited instance, a KYC verifier at an IDFC First Bank branch in Nashik misused a colleague’s login credentials to create mule accounts in exchange for commissions.
He also issued a public advisory warning against fraudulent investment schemes circulating on messaging platforms such as WhatsApp and Telegram, and clarified that law enforcement agencies do not conduct interrogations via video calls or demand money under the guise of “digital arrests”.
