XHelper Scam: India’s Banking Ecosystem at Risk

A recent report by CloudSEK, a cybersecurity firm, has revealed the existence of a large-scale money laundering scheme operated by China-based entities using an app called XHelper. The app, which is disguised as a legitimate money transfer business, recruits and manages money mules who help move illicit funds from various scams such as loan scams, e-commerce scams, illegal gambling apps, and pig butchering schemes.

What is XHelper?

XHelper is a sophisticated app that functions as a central hub for money mules, streamlining illegal transactions by simplifying payout and collection. Money mules are individuals who receive and transfer funds acquired through fraudulent activities, adding a layer of complexity for the cybercriminals who convert the funds into cryptocurrencies.

The app is distributed through websites posing as legitimate businesses under the guise of “Money Transfer Business”. The app creators lure potential money mules with promises of high commissions and rewards for completing payout orders within a strict 10-minute window. The app also includes many complex features to automate money laundering, such as QR codes, OTPs, transaction history, etc.

How does network work?

The app works by exploiting a critical loophole within India’s banking infrastructure, which enables Chinese cybercriminals to orchestrate a large-scale money laundering scheme targeting Indian citizens. The scheme involves the following steps:

• The cybercriminals initiate various scams such as loan scams, e-commerce scams, illegal gambling apps, and pig butchering schemes using fake payment gateways powered by XHelper.
• The victims of these scams are tricked into transferring money to the bank accounts of the money mules registered on XHelper.
• The money mules receive incoming funds from the scammers and are instructed by the app to transfer them to pre-designated accounts within 10 minutes.
• The pre-designated accounts belong to other money mules or intermediaries who further transfer the funds to other accounts or convert them into cryptocurrencies.

How big is XHelper?

According to CloudSEK’s report, XHelper has 37 thousand active users on the platform, who linked 16 thousand bank accounts. The app processed $1.9 million daily, with an average transfer size of $270 and more than 7000 daily transfers.

CloudSEK has alerted CERT-In, RBI, CBI, I4C, and other financial institutions about the app and its implications for the Indian banking ecosystem. The firm has also uncovered a growing ecosystem of similar applications facilitating money laundering across various scams.

XHelper is not an isolated incident, but a concerning example of how cybercriminals are using sophisticated tools to exploit loopholes and vulnerabilities in the financial system. It is imperative for authorities and users to be vigilant and aware of such malicious apps and their modus operandi.

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