Department of Financial Services (DFS) in the Finance Ministry on Friday urged banks to effectively address the growing challenge caused by digital financial frauds, especially mule accounts.
Chairing a crucial meeting with I4C, RBI, NABARD, PSBs and Private Banks, DFS Secretary M Nagaraju encouraged Banks to explore and implement MuleHunter.AI, an AI/ML-driven model developed by RBI, to strengthen the detection and monitoring of mule accounts.
Mule accounts in the banking system are bank accounts used by criminals to facilitate illegal activities, such as money laundering, cyber fraud, or other financial crimes. These accounts are often operated by “money mules,” individuals who allow their accounts to be used (knowingly or unknowingly) to receive and transfer illicit funds.
Nagaraju emphasised that measures are required to be taken to protect citizen’s hard-earned money. Protecting citizens’ wealth is our shared responsibility.
Banks were directed to adopt advanced technologies, including AI/ML solutions, for real-time detection of mule accounts, training & upskilling bank staff on fraud detection & prevention, greater advocacy & awareness for common citizen for not to fall prey to the fraudsters.
In the meeting, banks were urged to adopt best practices, leverage cutting-edge tools, and foster inter-bank collaboration to address mule accounts effectively.
He stressed the need for regulators and banks to work collectively in curbing digital financial frauds. Sharing of good practices across the banking sector was highlighted to ensure a unified and effective response.
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