The Reserve bank of India is rolling out an AI / ML-based model called MuleHunter.AI for detection of mule bank accounts.
“A pilot with two large public sector banks has yielded encouraging results. Banks are encouraged to collaborate with Reserve Bank Innovation Hub (RBIH) to further develop the MuleHunter.AI initiative to deal with the issue of mule bank accounts being used for committing financial frauds.” the central bank said in a statement.
The Reserve Bank has been taking various measures in coordination with banks and other stakeholders to prevent and mitigate digital frauds in the financial sector. These include RBI guidelines to regulated entities for strengthening cybersecurity, cyber fraud prevention and transaction monitoring.
Use of money mule accounts is a common method adopted by fraudsters to channel proceeds of frauds. The RBI is currently running a hackathon on the theme “Zero Financial Frauds” which includes a specific problem statement on mule accounts, to encourage development of innovative solutions to contain the use of mule accounts.
Growing mule activity
There has been a concerning bump in mule accounts in India, in line with the growing global threat, as per a report by global digital fraud detection company BioCatch. Most mule activity at 14 per cent of the total, was seen in Bhubaneswar followed by Lucknow and Navi Mumbai for 3.4 per cent each. Mumbai was 2.2 per cent, Bengaluru at 1.8 per cent, and Cuttack at 1.6 per cent.
Reacting to this, Rajesh Mirjankar, Co-Founder, MD, and CEO of KiyaAi said: “Initiatives like MuleHunter.AI demonstrate how AI can effectively address challenges like fraud detection and prevention, including use cases like mule accounts. By encouraging collaboration between regulators, banks and fintechs, these steps lay the groundwork for a more secure, inclusive, and tech-driven financial ecosystem”-