MHA Warns of Cybercriminals Exploiting Mule Accounts to Operate Illegal Payment Gateways for Money Laundering

The Union Home Ministry has issued a high-alert warning against illegal payment gateways established by international cybercriminal gangs using mule bank accounts to facilitate large-scale money laundering. According to officials, these gateways are run by transnational cybercriminals who provide money laundering services by utilizing shell company accounts and personal accounts, taking advantage of banks’ bulk payout capabilities.

Police forces in Gujarat and Andhra Pradesh recently conducted a series of nationwide raids uncovering a network of illegal digital payment gateways. These operations revealed that cybercriminals set up these unauthorized gateways using rented bank accounts to launder criminal proceeds. Payment services such as PeacePay, RTX Pay, PoccoPay, and RPPay were identified as part of this network, reportedly operated by foreign nationals who offer money laundering services.

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Analysis conducted by the Indian Cybercrime Coordination Centre (I4C), based on data gathered by state police forces, exposed the methods employed by these cybercriminals. They locate savings and current accounts of shell companies and individuals through social platforms like Telegram and Facebook, then remotely control these “mule accounts” from overseas. Using these accounts, illegal payment gateways are created to handle deposits on various fraudulent platforms, including fake investment websites, offshore betting sites, gambling platforms, and sham stock trading sites.

Upon receiving the proceeds from these illicit activities, the funds are immediately transferred to other accounts in a practice known as “layering.” This process often exploits the bulk payout systems provided by banks.

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The I4C has issued a public advisory urging citizens not to sell or rent out their bank accounts, company registration certificates, or Udhyam Aadhaar registration certificates, as any illicit funds deposited in such accounts could lead to severe legal consequences, including arrest. The advisory also encourages banks to implement monitoring mechanisms to detect the misuse of bank accounts in setting up illegal payment gateways.