A new category of fraud is gaining prominence in South Africa, as more cases of bank account holders becoming ‘money mules’ comes to light.
The Southern African Fraud Prevention Service (SAFPS) has issued a warning to account holders to be wary of criminals that are looking to rope them in to committing fraud through the scheme.
As banks start using biometrics (fingerprint identification) to verify account holders – in a bid to bring greater security to minimise identity theft and impersonation – it has also created a loophole for fraudsters, the SAFPS said.
“People on street corners are recruited as money mules with the promise of quick payments for the use of their banking account,” the group said.
A money mule is somebody who is used by another person knowingly or unknowingly. They will usually be recruited by someone who does not have their own bank account, or who wishes to make a transaction invisible.
This comes with the promise of a quick monetary reward.
Money muling has grown to such an extent that SAFPS has opened a new category of fraud due to the increasing number of bank accounts that have been abused by third parties in this manner.
“While this may seem like quick money, it is not,” SAFPS said. “The danger for the consumer is that they are complicit in a criminal act and will be getting themselves involved with a fraudster.”
“It might look like easy money, but the victim has no idea what the money is being used for and it is often for illegal gains and even human trafficking.”
Roping you in online
While recruiting is sometimes at street level in South Africa, in other parts of the world much of it is happening in cyber space.
The Australian Banking Association reported that Australian law enforcement and local banks generally saw two methods which criminals use to recruit unsuspecting innocent people in their illegal activities.
These are scams where fraudulent employment advertisements are posted online. Another method is emails that are sent to random addresses where you may be the recipient. This type of scam/email promises quick commissions in return for using the consumer’s bank account for receiving money and transferring it elsewhere on behalf of the fraudster.
The other method is romance scams. This is where vulnerable singles are targeted and asked to receive money and send it to a third party, taken in by the promise of a relationship. Criminals trawl online chat rooms, social networking sites, post hoax websites, or fake advertisements and fake profiles.