Supreme Court tightens rules to curb 'digital arrests', RBI to frame SOPs to deal with mule bank accounts

India's Supreme Court has mandated the Reserve Bank of India (RBI) to develop a comprehensive standard operating procedure (SOP) to address the misuse of bank accounts in cyber fraud. The court's intervention aims to put an end to 'digital arrests,' a coercive tactic used to extract funds from individuals implicated in online financial crimes.

The directive specifically targets bank accounts opened or utilized for receiving and transferring proceeds from cyber fraud. The RBI is tasked with creating clear guidelines to manage these accounts, ensuring a more structured and fair approach to investigations and fund recovery.

This decision by the Supreme Court underscores the growing concern over sophisticated cybercrimes and their impact on citizens. By demanding an SOP, the court seeks to establish robust mechanisms to protect individuals from becoming victims of fraud and to prevent the abuse of legal processes in addressing such crimes.