The Reserve Bank of India (RBI) has proposed a standard operating procedure (SOP) to enable banks to temporarily restrict debit transactions involving accounts or funds suspected to be associated with money-mule operations and cyber-enabled financial fraud.
The proposed framework follows the Supreme Court’s August 4 direction requiring the RBI to establish a standardised mechanism for temporary debit holds in suspected fraud-related cases.
Under the draft SOP, banks would be required to promptly impose a temporary debit restriction on a transaction identified as potentially involving a money mule. Where the bank determines that the entire account is suspected to function as a money-mule account, the temporary debit hold may be applied to the account itself.
The proposed mechanism is intended to provide banks with a uniform process for restricting suspected fraudulent transactions while addressing cyber-enabled financial fraud and misuse of bank accounts. CASansaar