Security Agencies Bust Mule Account Network In J&K, Fear Funds Aiding Separatist Activities

Last Updated:February 15, 2026, 17:40 IST

Officials said the money is moved in a complex way, passed through multiple accounts and split into smaller amounts to make tracking difficult.

Security agencies have uncovered a growing network of so-called “mule accounts" in Jammu and Kashmir, which they say is being used as the financial base for global scam operations. Officials fear the money moving through these accounts could also be diverted for separatist and anti-national activities.

According to officials, more than 8,000 such accounts have been identified and frozen over the past three years, revealing an organised system of money laundering. These accounts are seen as the weakest but most essential part of cybercrime, since stolen money cannot be converted into cryptocurrency without them.

Central agencies have asked the Jammu and Kashmir Police and other law enforcement bodies to work with banks to stop the spread of mule accounts and track down the middlemen, known as “mulers", who arrange these setups.

Officials believe that after the National Investigation Agency cracked down on illegal money flows in 2017, anti-national groups shifted to a new form of “digital hawala". In this model, commissions earned by mule account holders or mulers may be used for activities against the country.

A muler does not usually contact victims or send fake links. Instead, they quietly manage and supply mule accounts to scammers, allowing them to move stolen money without exposing their own identities.

Most mule accounts belong to ordinary people who are tempted by offers of easy money and told there is little risk. They are convinced to hand over full control of their bank accounts, including online banking details, claiming the accounts will be used only briefly.

In many cases, one scammer is given access to 10 to 30 accounts at a time. Some accounts are even opened in the names of fake companies, making it possible to move up to Rs 40 lakh in a single day without immediate suspicion.

Officials said the money is moved in a complex way, passed through multiple accounts and split into smaller amounts to make tracking difficult.

Law enforcement agencies stressed that even if mule account holders are not directly running the scams, they play a key role in money laundering. By sharing account access and taking commissions, they knowingly provide the financial structure that supports international crime.

“The entire system depends on these accounts. Without a place to send the money, the scam collapses. Those renting out their accounts are not just bystanders, they are central to the crime," a senior official said.

A study by central agencies found that people in countries such as China, Malaysia, Myanmar and Cambodia guide individuals in Jammu and Kashmir to set up private crypto wallets. These are often created using VPNs to avoid detection and usually do not require any KYC or identity checks.

The Jammu and Kashmir Police has already suspended the use of VPNs in the valley, calling them a useful tool for terrorists and separatists to stay hidden.

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