Indian Youth Exploited as Money Mules: Syndicates Under Fire as Authorities Sound Alarm
Cybercriminals are hijacking India's next generation—turning them into unwitting pawns in global money laundering schemes. Here's how the scam works—and why regulators are scrambling to stop it.
The Playbook: Fraud rings recruit tech-savvy young adults with promises of quick crypto profits, only to funnel dirty money through their accounts. By the time victims realize they're complicit, the syndicates have vanished—leaving them holding the bag.
The Fallout: Banks report surging suspicious transactions linked to student accounts, while law enforcement warns these 'mules' face frozen assets—or worse, criminal charges. Meanwhile, the masterminds laugh all the way to their offshore wallets.
Another day, another financial crime hiding behind blockchain's 'innovation' halo. Maybe next they'll tokenize prison sentences.
Indian authorities issue warnings to youths
According to Ajay, within weeks of carrying out these kinds of services, the Indian police knocked on his door and demanded to see him. It was at that point that the police told him that the money he had been helping the crypto trader MOVE was part of an elaborate international financial crime. They told him that the criminals were routing the funds through his account to mask their trail.
After being apprehended by the Indian police, Ajay started helping them, pointing them in the right direction. Investigators said they were able to identify other account holders and middlemen involved in the syndicate that shared a LINK from Chowk, Indira Nagar, and Sushant Golf City to handlers out of Cambodia, Laos, Vietnam, and Thailand.
Investigations carried out by the Crime Branch and Cyber Cell division of the Indian police in the past three months have uncovered dozens of mule accounts. These accounts, typically belonging to young boys and girls in the area, have been turned into tools to move illicit proceeds.
Many of these account holders are regular people, with most of them working in restaurants, small shops, and contractual jobs. Others are college students who were hired with the promise of Rs. 10,000 to Rs. 30,000 in commission to lend their accounts to facilitators, who move cyber fraud proceeds into them. Some of these funds are moved to digital assets, especially USDT, using peer-to-peer networks.
Police say operations are carried out on Telegram
According to the Indian police, the operations are carried out on encrypted Telegram channels run by Chinese handlers. Local recruiters are often charged with collecting accounts, bypassing proper KYC. On the days of transactions, mule account holders are taken to the bank to withdraw these funds before handing them over to brokers who convert them into crypto.
Most of the funds are from different kinds of cybercrime carried out across India. In the past month, police in Lucknow said they have tracked as much as Rs. 5 crore ($570,000) being laundered through such accounts. The networks avoid legal routes, disguising their activities as crypto trading so they can go under the radar without being noticed by authorities.
Police said it has already detailed around 60 young men because their accounts were used as mules in cases involving crores of rupees. “These young people aren’t hardened criminals, but their actions enable large-scale fraud,” Additional Deputy Commissioner of Police (Lucknow South) Rallapalli Vasanth Kumar told PTI. “Several youths have confessed regret, admitting they underestimated the legal risks,” he added.
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