India Trading Fraud Case Exposes 507 Mule Bank Accounts

Bengaluru investment fraud investigators have arrested three men in an alleged online trading and investment scam that caused a city resident to lose nearly Rs 94 lakh. The investigation uncovered a network involving 507 suspected mule bank accounts, fake mobile applications and fund transfers linked to Kolkata, Hong Kong and California, highlighting the cross-border structure under investigation.

Fake Trading Apps Used to Control Bank Accounts

The case began after a Peenya resident filed a complaint on May 28, alleging that he was forced to transfer Rs 93,58,555 to multiple bank accounts as part of the suspected fraud.

According to Bengaluru cyber police, the suspects obtained current, corporate and trust bank accounts, together with net banking credentials and linked SIM cards, from various individuals in exchange for commissions. The investigation identified 507 bank accounts allegedly procured and supplied to the cyber fraud network.

Police said the suspects used a hotel in Kachuvanahalli as a makeshift operations centre. Account holders were allegedly kept at the location while fraudulent apps, including “ZNPAY” and SMS-forwarding APKs, were installed on their phones.

Investigators alleged that these applications intercepted banking OTPs and SMS alerts, forwarding them to the fraudsters. This allegedly enabled remote access to bank accounts and helped route suspected fraud proceeds through multiple accounts.

Mule Accounts and Cross-Border Fund Trails

The investigation identified financial flows involving multiple banking channels. Police said approximately Rs 13 lakh in suspected fraud proceeds moved through a government-owned bank account, while more than Rs 38 lakh passed through a specific private bank current account.

According to investigators, funds were transferred through multiple accounts and later sent to a Binance cryptocurrency wallet. Police also said mule account owners were allegedly paid between Rs 1.5 lakh and Rs 2 lakh, while the wider investigation traced digital connections to Kolkata, Hong Kong and California.

The case illustrates how alleged online investment fraud can involve several layers, including fake trading applications, account suppliers, intermediaries and cryptocurrency transfers. However, the specific role of each individual and the full movement of funds remain under investigation.

Three Arrested as Investigation Continues

Police arrested Amit Mishra on September 8 after tracing a mobile phone to a building in Lucknow, Uttar Pradesh. Two other suspects, Tausif Ahmed and Parashuram Sadanand Kannanavar, also known as Pavan Kumar, were arrested on September 9 after investigators identified their alleged connections to Mishra.

Authorities recovered six mobile phones from the three accused. A fourth suspect, identified as Anoop alias Julpi, along with individuals using the Telegram handles “@zhangxueyou123” and “@SZNKM,” remained untraced according to the provided report.

Police said they were investigating the roles of other individuals allegedly linked to the ZNPAY platform, including Sumon, Nick, Dilawar, Iftikhar, Abhinav and Vivek. Details of the fake applications and 51 other suspicious APK files were forwarded to the Indian Cybercrime Coordination Centre (I4C) for technical analysis.

What Investors Should Watch

The case highlights the risks of downloading unverified trading applications, sharing banking credentials or allowing third parties to control accounts and linked SIM cards. Investors should verify the identity and regulatory status of a trading platform before transferring funds and avoid applications or payment arrangements that require unusual access to banking information.

The investigation remains ongoing, and allegations against the suspects have not been established as final criminal findings. Follow BrokersView for more investment fraud cases, broker risk alerts and regulatory developments.

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