Srinagar, Jan 7 — Counter Intelligence Kashmir (CIK) has detained 22 persons across the Valley in a major crackdown on an organised syndicate involved in operating mule bank accounts to launder proceeds of cyber fraud, illegal online gaming and betting, officials said on Wednesday.
The action follows the registration of FIR No. 06/2025 at Police Station Counter Intelligence Kashmir under provisions of the Information Technology Act, the Bharatiya Nyaya Sanhita and the Unlawful Activities (Prevention) Act, after investigators received specific intelligence inputs about a well-entrenched financial crime network posing a serious threat to economic and digital security.
According to CIK, investigations have revealed a carefully planned conspiracy in which accused persons, in coordination with local and outside operatives, misused bank accounts of economically vulnerable individuals and converted them into mule accounts. These accounts were used as temporary channels to route large volumes of illicit money generated through cyber scams, fake investment and trading applications, and banned online gaming and betting platforms. Authorities said the funds are suspected to have been further diverted for activities linked to terror financing.
Officials said the syndicate functioned by flouting banking norms and manipulating KYC procedures. The network allegedly created non-existent business entities on the UDYAM portal, used them to open accounts, obtained virtual account numbers, and relied on identity theft, impersonation and layered money-laundering methods to conceal the origin and destination of funds.
A senior official explained that mule accounts form a crucial link in cyber-enabled crimes by distancing the actual fraudsters from victims and law enforcement agencies. In most cases, victims are contacted through phone calls, messages or social media advertisements, where fraudsters pose as police officials, bank or RBI officers, job recruiters or investment advisors. Victims are then coerced or deceived into transferring money to so-called verification accounts or sharing sensitive banking credentials.
During the preliminary probe, CIK identified 22 suspects operating within the Kashmir Division. After obtaining search warrants from the Special NIA Court in Srinagar, simultaneous searches were conducted at 22 locations across Srinagar, Budgam, Shopian and Kulgam districts. The searches led to the seizure of digital devices and financial records considered vital to the investigation.
CIK said all 22 suspects have been detained for questioning to determine their exact roles and linkages with cyber frauds, illegal betting platforms and suspicious financial transactions. Officials added that the investigation is at an early stage and is expected to expose a much wider network extending beyond Jammu and Kashmir in the coming days.