Jaipur, Rajasthan — Policy shift aimed at curbing the misuse of criminal procedures in civil disputes and protecting citizens’ financial rights, the Rajasthan Police Headquarters (PHQ) has issued strict guidelines regulating the freezing of bank accounts during investigations. According to the circular, police officers may no longer freeze entire bank accounts unless absolutely necessary, and even then, only the disputed amount may be held—with written approval from the district Superintendent of Police (SP).
This directive follows recent observations by the Rajasthan High Court’s Jaipur bench, which criticized the practice of freezing whole accounts during early stages of civil or financial fraud investigations. The new rules prioritize transparency, due process, and financial fairness.
Targeted Freezes Only with SP Approval
Under the new standard operating procedure (SOP), bank accounts should not be completely frozen in matters under investigation, especially when the case involves a civil dispute with financial elements. Police officers have been clearly instructed to hold only the amount directly in dispute, and only after receiving written approval from the district SP. The rest of the account’s funds must remain accessible to the holder.
This change aims to prevent the undue hardship caused by indiscriminate freezing of personal and business accounts, which often paralyze day-to-day operations and violate basic rights. It reflects a growing judicial and administrative consensus that blanket financial restrictions in ongoing inquiries can be arbitrary and excessive.
“A suspected cartel of police officers, bank officials, and cybercriminals is orchestrating an account-freezing scam, extorting victims to unfreeze business and high-net-worth accounts. Rajasthan Police HQ has ordered action to dismantle this cartel.”
Safeguards Against Misuse of Criminal Law in Civil Cases
The circular also provides instructions on the legal distinction between civil and criminal liability. Police must not register FIRs in disputes of a purely civil nature where criminal intent is not evident. In matters where both civil and criminal aspects are entangled, officers must conduct a preliminary inquiry within 14 days before proceeding with arrests or document seizures. This aligns with Section 173(3)(i) of the newly enforced Bharatiya Nagarik Suraksha Sanhita (BNSS), 2023.
The directive also reinforces compliance with the Supreme Court ruling in Lalita Kumari vs State of Uttar Pradesh, which mandates a preliminary probe in ambiguous cases before registering a First Information Report (FIR). The move is expected to prevent harassment, protect citizens’ liberty, and reinforce discipline within police operations, especially in white-collar or cybercrime-linked disputes.
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Suspicious Transactions and Mule Accounts Under Cyber Surveillance
In a parallel effort to clamp down on cyber fraud, the PHQ has launched a surveillance campaign focused on suspicious bank transactions. The campaign, running until June 25, emphasizes tracing and monitoring bank accounts suspected of acting as mule accounts in laundering money stolen through online frauds. Police are leveraging the Ministry of Home Affairs’ Samanvaya portal to flag these accounts in real-time.
For example, Bikaner district alone is currently monitoring over 550 suspicious accounts, with other districts reporting similar numbers. These accounts are being examined for unusual financial activity, possible links to cybercriminals, and signs of impersonation or identity fraud.
In cases involving large cash transactions—especially in property deals and high-value contracts—where amounts exceed ₹2 lakh, the police have been directed to report the transactions to the Income Tax Department using a prescribed format. Joint Director Kunal Haver, designated as the nodal officer for such reports, will receive the submissions in Jaipur.
