One of my clients recently had a case which I am explaining below and if you are stuck in such similar situation, here is what to do.

Note: Due to attorney-client privilege, I cannot disclose complete case details or identify the actual parties involved. However, I am sharing the essential facts and legal approach so that if you find yourself in a similar situation, you can understand the available solutions and legal remedies.

Mr.X, an 18-year-old student from City A, fell victim to an online gaming scam where he was promised extra coins after purchasing game currency through his UPI account. Two days after the transaction, his UPI account was completely frozen, preventing any money transfers. When Mr.X contacted customer service of XYZ Bank, they informed him that his account had been flagged as a “mule account” – typically used in money laundering operations. The bank suspected his account was being used to funnel illegal money through multiple transactions. Mr.X was completely unaware that the gaming platform was fraudulent and had unknowingly participated in a cyber fraud scheme. His account remained frozen for weeks, causing significant inconvenience in his daily transactions and student life.

Advice in Such Cases

Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation to come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

Immediately gather all transaction records and proof of the gaming platform’s fraudulent nature. Contact your bank’s grievance redressal officer in writing, explaining your innocence and providing evidence. File a cyber crime complaint with local police to establish your victim status. Document all communication with the bank and maintain records of financial hardship caused by the freeze.

Applicable Sections of Law

Under the Bharatiya Nyaya Sanhita (BNS), several sections apply to such cases. Section 318 deals with cyber fraud and cheating through electronic means. Section 308 covers criminal conspiracy when multiple parties are involved in the fraud. Section 61 addresses criminal breach of trust by the gaming platform operators. Under Bharatiya Nagarik Suraksha Sanhita (BNSS), Section 173 governs the investigation of cyber crimes, while Section 35 deals with electronic evidence collection procedures in such financial fraud cases.

If You Are the Complainant

• File an FIR at the cyber crime police station with all transaction details and platform information
• Submit a detailed complaint to the bank’s nodal officer explaining your victim status
• Approach the Banking Ombudsman if the bank doesn’t respond within 30 days
• Gather evidence proving the fraudulent nature of the gaming platform or website
• Maintain detailed records of all financial losses and inconvenience caused by the account freeze

If You Are the Victim

• Immediately report the fraud to the National Cyber Crime Reporting Portal (cybercrime.gov.in)
• Contact your bank’s customer care and request an investigation review of your account status
• Submit an affidavit declaring your innocence and explaining how you became an unknowing participant
• Provide proof of being a genuine student with limited financial resources
• Request temporary partial access to your account for essential transactions while investigation proceeds

How the Police Behave in Such Cases

Police typically treat mule account cases seriously as they’re often connected to larger money laundering operations. Initially, they may view account holders with suspicion, assuming willful participation. However, once you establish victim status with proper evidence and documentation, their approach becomes more cooperative. They usually coordinate with cyber crime cells and banking fraud investigation units for comprehensive investigation.

FAQs People Normally Have

Q: How long will my account remain frozen?
A: Typically 15-90 days depending on investigation complexity and your cooperation in providing evidence.

Q: Can I open a new account elsewhere?
A: Yes, but inform the new bank about the ongoing investigation to avoid future complications.

Q: Will this affect my credit score?
A: Account freezes generally don’t impact credit scores unless there are loan defaults due to frozen funds.

Q: Can I claim compensation for losses?
A: Yes, you can claim compensation for financial hardship caused by wrongful freezing if proven innocent.

What Evidence Is Required?

• Complete transaction history and bank statements showing the disputed transactions
• Screenshots and documentation of the fraudulent gaming platform
• Communication records with the gaming platform’s customer service
• Proof of student status and limited financial resources
• Evidence showing you’re a victim rather than willing participant
• Affidavit declaring innocence and explaining circumstances
• Any promotional materials or advertisements that led you to the fraudulent platform

How Long Will the Investigation Take?

Bank investigations typically take 30-60 days for straightforward cases. However, if multiple agencies are involved or if the fraud network is complex, it may extend to 3-6 months. Cyber crime investigations usually run parallel and can take 6-12 months for complete resolution. Your active cooperation and proper documentation can significantly speed up the process.

Advocate Sudhir Rao, Supreme Court of India