RBI Cracks Down On Banking Fraud, Deploys AI To Weed Out 'Mule Accounts'

The Reserve Bank Innovation Hub (RBIH) in Bengaluru has developed an Artificial Intelligence (AI) tool to help banks reduce digital frauds. "An innovative AI / ML based model, namely, MuleHunter. AITM has been developed by the Reserve Bank Innovation Hub (RBIH), Bengaluru", said RBI Governor Shaktikanta Das, adding that the tool will help banks to deal with the issue of mule bank accounts expeditiously and reduce digital frauds. Mule accounts are usually 'benami' or fraudulent bank accounts used for money laundering by fraudsters. The RBI is also setting up a committee of experts from diverse fields to recommend a Framework for Responsible and Ethical Enablement of AI (FREE-AI) in the financial sector. The panel will look at technologies such as AI, tokenisation, Cloud Computing, etc. while addressing the associated risks such as algorithmic bias, explainability, data privacy among others.