8,000 accounts with anti-India activities frozen as “digital hawala” network uncovered in J&K

Security agencies have uncovered a large network of “mule accounts” in Jammu and Kashmir that investigators say forms the financial backbone of international scam syndicates. More than 8,000 accounts have been identified and frozen over the past three years amid concerns the funds could be diverted towards anti-national operations.

Officials said criminals used these accounts to route stolen money and convert it into untraceable digital assets such as cryptocurrency. The accounts were often opened in the names of ordinary individuals lured by small commissions and persuaded to hand over full banking access under the pretext of temporary use.

Authorities believe the system represents an evolved “digital hawala” model that emerged after earlier crackdowns on illegal financial flows in the region. A single operator could control 10 to 30 accounts at once, with funds rapidly moved across multiple accounts or shell companies to avoid detection.

Central agencies have asked police and banks to curb the spread of such accounts and identify intermediaries known as “mulers,” who recruit account holders and manage transactions. Investigators say many recruits were guided by handlers based abroad to create cryptocurrency wallets using masked digital identities.