In a bid to combat rising cyber fraud, Hyderabad Police are collaborating with banks to tighten security measures and prevent the misuse of bank accounts, focusing on enhanced KYC verification and zero tolerance policies.
Key Points
- Hyderabad Police are addressing cyber fraud by targeting the misuse of bank accounts.
- Operation Octopus led to the arrest of bank officials involved in opening mule accounts.
- Cyber fraud networks operate from countries like Cambodia, Vietnam, and Dubai.
- The police commissioner recommended a twin-challenge framework for banks, prioritising citizen safety and institutional integrity.
- Banks are urged to adopt zero tolerance policies towards cybercrime and enhance KYC compliance.
Hyderabad Police Commissioner V C Sajjanar on Thursday convened a meeting with bankers to discuss the misuse of bank accounts in cyber frauds and measures to prevent such offences.
Operation Octopus and Its Impact
After the 'Operation Octopus' - the Hyderabad City Police's coordinated two-phase initiative to dismantle organised cyber fraud networks - and the subsequent arrest of bank officials found potentially complicit in the opening of mule accounts, the Commissioner convened the high-level coordination meeting which was attended by 75 representatives from 45 public and private sector banks, an official release said.
The commissioner provided a detailed briefing on the operating methods of cyber fraud syndicates currently active across India.
Cyber Fraud Syndicate Operations
"These networks are primarily headquartered in countries including Cambodia, Vietnam, besides Dubai, and engage intermediaries within India to procure bank accounts by colluding with bank officials - particularly KYC Verifiers - to facilitate the siphoning of funds from Indian victims", he said.
Recommendations for Banks
Sajjanar recommended introduction of a twin-challenge framework to reorient bank branch priorities away from account-opening targets and towards citizen safety and institutional integrity.
He strongly advocated that both these challenges should be embedded as formal Key Performance Indicators (KPIs) at the branch level, with branches achieving compliance to be formally recognised and rewarded by higher officials of the bank.
The commissioner emphasised that safe customer and zero mule account outcomes - not account volumes - must define branch performance.
"Zero cybercrime victims is the measurable target - to be monitored via National Cyber Crime Reporting Portal (NCRP) complaint data linked to the branch. And no mule account should be opened at the branch. Strict KYC compliance, enhanced due diligence, and real-time monitoring are the operational requirements underlying this target," he said.
Zero Tolerance Policy
Banks must adopt a policy of zero tolerance towards cybercrime at every level of the organisation - from frontline staff to senior management, he said.
Strict disciplinary action must be taken against KYC verifiers found involved in fraudulent account openings, accompanied by periodic forensic audits of accounts opened by flagged officials, Sajjanar said.
Advanced technological tools - including solutions such as Mule Hunter - must be adopted to detect and prevent mule account activity in real time, he added.
Investigation Details
Through an intensive investigation into the surge of investment scams, trading frauds, and "digital arrest" scams, the Cyber Crime Police Station (CCPS), uncovered a nexus of 350 bank accounts used to siphon off victims' funds, Police earlier said.
These accounts were linked to approximately 850 cases across the country involving transactions amounting to nearly Rs 150 crores.
Recognising the seriousness of the situation, 'Operation Octopusâ 1' was executed across 16 states resulting in the arrest of 117 accused persons in February this year.
Under 'Operation Octopus 2.O', police said they dismantled a pan-India cyber fraud network involving bank officials by arresting 52 accused--32 bank officials, 15 mule account holders and five middlemen across nine states.
The bank officials were found to be in connivance in the opening of mule bank accounts which were used to facilitate cyber frauds, police had said.
