Hyderabad police bust Pan-India cyber fraud network, bank officials among key accused

In a major breakthrough against organised cybercrime, Hyderabad Police has dismantled a nationwide fraud network involving bank insiders, arresting 52 individuals across nine states under “Operation Octopus 2.0”.

The arrests include 32 bank officials, 15 mule account holders, and five middlemen, exposing a deep-rooted nexus that enabled large-scale financial fraud. Police said the accused played critical roles in facilitating illegal transactions by opening and managing mule bank accounts used to channel stolen funds.

According to officials, the operation was conducted simultaneously across states including Maharashtra, Delhi, Karnataka, Telangana, Andhra Pradesh, Bihar, Gujarat, Rajasthan, and West Bengal. A total of 16 special teams carried out coordinated raids over a week, targeting individuals already identified during earlier investigations.

Investigators revealed that bank officials allegedly bypassed KYC norms and assisted in opening suspicious accounts, which were then used by cybercriminals to receive and transfer illicit money. Mule account holders knowingly allowed their accounts to be used for laundering funds, while middlemen acted as key links between fraudsters and banking channels.

The crackdown builds on intelligence gathered during “Operation Octopus 1”, which uncovered a network of over 350 bank accounts linked to nearly 850 cybercrime cases involving transactions worth around ₹150 crore. The earlier phase, conducted across 16 states, had resulted in 117 arrests.

Police noted a sharp rise in cyber frauds such as investment scams, trading frauds, and so-called “digital arrest” schemes, where victims are manipulated or intimidated into transferring money. Officials said targeting the financial infrastructure behind these crimes was crucial to disrupting such networks.

The latest operation highlights the growing role of insider involvement in cybercrime and underscores a shift in policing strategy from tracking individual offenders to dismantling entire fraud ecosystems through coordinated, data-driven efforts across states