HYDERABAD: Hyderabad City Police have dismantled a pan-India cyber fraud network in a coordinated drive named "Operation Octopus 2.0". Notably, 52 accused were arrested across nine states.
Among them, 32 are bank officials.
The operation targeted organised syndicates that used mule bank accounts to siphon off victims' money. Specifically, police identified 32 bank officials, 15 mule account holders, and five middlemen. These middlemen, in turn, helped procure accounts and transfer funds.
Rising Digital Fraud Prompts Crackdown
In recent months, officials have reported a sharp rise in investment scams, trading frauds, and so-called "digital arrest" scams. In such cases, fraudsters often intimidate victims into transferring money.
Earlier, investigations by the Cyber Crime Police Station (CCPS),
Moreover, in February 2026, "Operation Octopus 1" led to 117 arrests across 16 states. Building on that success, police subsequently launched Operation Octopus 2.0 to probe deeper links.
Bank Officials Under Scanner
This time, investigators focused on bank insiders who allegedly enabled fraud. For instance, police arrested a relationship manager from Bandhan Bank for colluding with fraudsters.
In addition, officials from several banks were among those arrested. These include AU Small Finance Bank, Bandhan Bank, Bank of Baroda, Federal Bank, IDFC First Bank, IndusInd Bank, Karnataka Bank, Karur Vysya Bank, Equitas Small Finance Bank, and HDFC Bank. They held roles such as managers, KYC approvers, clerks, and field officers.
Meanwhile, police said mule account holders knowingly allowed misuse of their accounts. At the same time, middlemen sourced these accounts and routed illegal funds.
Seizures Highlight Scale of Network
During the operation, police seized key evidence. For example, they recovered 26 mobile phones, 14 cheque books, two pen drives, one laptop, and 21 shell company stamps.
Furthermore, the crackdown lasted seven days. During this period, 16 special teams carried out raids across multiple states, including Maharashtra, Delhi, Rajasthan, West Bengal, Karnataka, Gujarat, Andhra Pradesh, Telangana, and Bihar.
Private Banks Face Scrutiny
Investigators found that private sector banks were largely involved. In particular, officials pointed to weak due diligence and poor KYC checks. As a result, these gaps made it easier for fraudsters to exploit the system.
Therefore, police stressed the need for stricter compliance and stronger accountability within banks.
Zero Tolerance for Cybercrime
The operation was supervised by DCP (Cybercrimes) V. Aravind Babu and ACP R. G. Siva Maruthi. Meanwhile, officials confirmed that the investigation is ongoing.
Going forward, they aim to identify higher-level operatives in the network. At the same time, police warned that anyone involved, regardless of position, will face strict legal action. Ultimately, Hyderabad Police reiterated their zero-tolerance stance and said Operation Octopus will continue.