Supreme Court: RBI to Prepare SOP Against Digital Arrest Scams in India

• The Supreme Court has issued nationwide directions to combat digital arrest scams in India.
• The RBI has been directed to prepare an SOP within four weeks for dealing with mule accounts.
• Complaints received on the NCRP have decreased significantly, from 1,23,672 in 2024 to 16,377 up to June 30, 2026.

The Court noted that the latest status report reflected encouraging progress in tackling digital arrest scams.

The Supreme Court has taken a significant step to combat digital arrest scams in India, issuing nationwide directions to strengthen the fight against this growing menace. The Court's order comes after considering a status report filed by the Indian Cyber Crime Coordination Centre (I4C), which detailed the progress made by various stakeholders in tackling digital arrest scams. According to the report, complaints received on the National Cyber Crime Reporting Portal (NCRP) have decreased significantly, from 1,23,672 in 2024 to 16,377 up to June 30, 2026. This decline is a testament to the efforts of law enforcement agencies and financial institutions in addressing this issue.

The Supreme Court has directed the Reserve Bank of India (RBI) to prepare a standard operating procedure (SOP) within four weeks for dealing with mule accounts. Mule accounts are bank accounts used by criminals to receive, transfer or launder illicit money, often without the knowledge of the account holder. The RBI's SOP is expected to provide clarity on compliance obligations and potential exposures for financial institutions. This move is a significant step towards ensuring that financial institutions are equipped to deal with digital arrest scams effectively.

The Supreme Court's directions on digital arrest scams have far-reaching implications for both financial institutions and consumers. The RBI's SOP will help financial institutions identify and prevent mule accounts, reducing the risk of financial losses due to digital arrest scams. Additionally, the decline in complaints received on the NCRP indicates that consumers are becoming more aware of these scams and taking steps to protect themselves. However, there is still a need for increased awareness and education among consumers about the risks associated with digital arrest scams.

Lawyers should watch for the RBI's standard operating procedure (SOP) on mule accounts, which may provide clarity on compliance obligations and potential exposures for financial institutions.

Source: Original reporting via Supreme Court of India