Are You a Money Mule? How to Avoid Emerging Scams

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The days of con artists approaching someone in public have been largely replaced by versions of scams in which the fraudster never shows his face. People develop real friendships and reply to job posting online each day, and scammers know the online marketplace is fertile ground for them.

SouthState wants to share vital information about emerging fraud trends including money mules and digital wallet scams.

Keys To Remember

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Icon for Keys To Remember
  • Never click links in unsolicited text messages or emails
  • Never provide your online banking credentials to anyone
  • Call (800) 277-2175 if you encounter suspicious messages or calls

What Is a Money Mule?

Account mules, or money mules, often appear as money-making opportunities such as remote work, social media sponsorship or digital marketing. In essence, this scam begins as a “job.”

The scammer asks you to open a new bank account to receive your pay. You’re then asked to transfer a portion of the money into another account in exchange for your commission. This can look like a wire transfer, ACH, or sending money via Western Union or MoneyGram.

Two red flags to notice here: the request to open a new account and then saying you must transfer a portion of the funds.
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Two red flags to notice here: the request to open a new account and then saying you must transfer a portion of the funds.

Scammers also develop fake romantic relationships to pressure people into an illegal money transfer. They can easily create a fake identity and use a dating app to connect with potential victims.

Unknowingly, money mules help criminals move illegal funds undetected through the financial system. Their goal is to hide their account activity through multiple people, making it harder for law enforcement to track their movements.

Even if the mule is participating in money laundering without full knowledge of the situation, they can be prosecuted. They’ll also suffer damage to their credit and may have their personal information stolen by the scammers once they move onto other targets.

Money Mule Red Flags Include:

  • Unsolicited direct message on social media 
  • Unusual wording or grammar 
  • Pressure or urgency in scammer’s messages 
  • Promises of a large commission for little effort 
  • All communication and job duties are online 
  • Being offered job with no experience or educational qualifications
Always be wary of money transfer requests from people you don’t know well. Even if they claim to be your new employer, question their motives and methods.

How Does Digital Wallet Fraud Work?

Let’s begin with defining what a digital wallet is. Like the name suggests, a digital wallet is a virtual version of your credit card or debit card. You may have used Samsung Pay, Google Pay or Apple Pay to set up your digital wallet.

Digital wallets allow you to make payments quickly without pulling out your physical card to swipe. Payment terminals that accept “tap to pay” are becoming more common.

Digital Wallet Fraud Can Happen a Few Different Ways:

A scammer may find your debit or credit card information on the dark web. They set up a digital wallet on their device, making as many purchases as they can before you turn your card off.

Scammers can also hack into your online bank account with stolen credentials. This type of attack, an account takeover (ATO) attack, allows fraudsters access to a digital wallet. They make purchases, steal payment information or sell the credentials online.

How Can I Prevent Digital Wallet Fraud?

Much like other types of fraud, being knowledgeable about your account activity and using strong security measures can go a long way. 
  • Keep a close eye on your finances. It’s not overkill to review transactions daily. 
  • Enable two-factor authentication so you’ll need to complete an additional layer of verification when signing into a digital wallet. 
  • Consider connecting a secondary account or card to your digital wallet. If your wallet is compromised, fraudsters won’t gain access to your primary bank account.
  • Don’t use a digital wallet on an unsecured WiFi connection, especially in a public shopping area. Use your phone’s data plan instead. 
  • Consider installing trusted security software on your phone. Some vendors give you the ability to lock or wipe your phone from another device, clearing your credentials and other sensitive information.
Find more information on combating scams on our website. If you suspect fraud or have been a victim of a scam, call SouthState immediately at (800) 277-2175.

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