RBI’s Mule Hunter

RBI’s Mule Hunter

Sub: Eco

Sec: Monetary Policy

Why in News

The Reserve Bank of India (RBI) has launched Mule Hunter, an Artificial Intelligence (AI) and Machine Learning (ML)-powered system aimed at tackling digital frauds involving mule bank accounts.

Mule Hunter:

• To identify and mitigate fraudulent activities associated with mule accounts.
• Leverages AI and ML algorithms to detect fraud patterns.

• Developer: Created by the Reserve Bank Innovation Hub (RBIH), Bengaluru.
• Operation: Utilizes databases from all banks and payment system operators for comprehensive fraud detection.
• Infrastructure-level setup with real-time fraud detection capabilities.

• Supports all banks and payment systems, creating a centralized approach to fraud management.
• Enables expeditious resolution of mule account cases, reducing operational delays.

Mule account:

• A mule account is a bank account or financial account used to transfer illegally acquired money on behalf of others.
• Purpose: These accounts are used to move money from one place to another, often across borders, to obscure the source of funds and make them appear legitimate.
• How it works: The account holder (the “mule”) allows their account to be used for receiving and transferring money. They typically keep a small percentage of the transferred funds as payment.
• The bulk of the money is then forwarded to another account as directed by the criminals.
• Types of mules:
  • Unwitting mules: People tricked into believing they’re doing legitimate work.
  • Witting mules: Those who knowingly participate in the scheme.