Wire fraud is costing people and organizations billions annually. CertifID identified $1.4 billion (about $4 per person in the US) in suspected wire fraud attempts during 2022. That is an increase of 181% from 2017 to 2021 (CertifID, 2022).
This is an urgent issue affecting both businesses and our customers alike. The allure of quick and convenient money transfers is undeniable, but it comes with its own set of risks. The ease and speed that make wire transfers attractive are the same factors that make them a prime target for fraudsters. Fraud like fake invoices, and real estate fraud often exploit the urgency and lack of scrutiny in wire transfer processes. Here are some tips to help keep you safe!
Common Scams: Wire fraud is a serious crime that can have a devastating impact on victims. Here are just a few of the most common wire fraud tactics and what to look for:
- Fake Invoices: Scammers send counterfeit invoices that look like they are from legitimate vendors. They may ask you to wire money to a fraudulent account.
- Real Estate Fraud: Scammers trick you into sending money to a fake account during a property transaction, often by hacking into an individual or business email account. They may pose as a real estate agent or lawyer.
- Personal Impersonation: Scammers pose as a distressed family member or friend in need of emergency funds. They may ask you to wire money to a fraudulent account.
- Overpayment Scams: Scammers send you a check for more than the amount owed and ask you to wire back the difference. The initial check will eventually bounce, leaving you out of pocket.
- Business email compromise (BEC): Scammers hack into a business's email account and send fraudulent emails to employees, requesting wire transfers. The emails may appear to be from a legitimate sender, such as a CEO or CFO.
Spotting Red Flags: Awareness is your first line of defense against wire fraud. Scammers are constantly evolving their tactics, so it is important to be aware of the latest red flags. Here are a few things to look for:
- Last-Minute Changes: Sudden changes in account details are a glaring red flag. Always verify added details through a trusted channel.
- Compromised Emails: A compromised email account can leak deal-specific information. Always double-check any unusual email activity.
- Unusual Urgency: Scammers use urgency to cloud your judgment. Always question why a transaction needs to be rushed.
Proactive Steps: Wire fraud is a serious crime, but there are steps you can take to protect yourself. Here are a few proactive steps you can take:
- Voice Verification: Always verbally confirm transaction details using a verified and trusted number. Never call the number provided in an email message, and always ask questions to confirm the identity of the individual on the other end of the conversation to avoid voice modification scammers.
- Secure Your Email: Strengthen email security by using robust passwords and two-factor authentication. If you think your email account has been compromised, you should review inbox rules that might have been created by the attacker to obfuscate their malicious actions – such as auto forwarding actions.
- Regular Monitoring: Keep an eye on your bank statements and flag any unauthorized transactions immediately.
What to Do If You are a Victim: Wire transfers are immediate, and this makes it difficult to recover funds. However, there are still steps you can take if you are a victim of wire fraud. Here is what you should do:
- Contact your bank immediately: Tell them that you have been the victim of wire fraud and ask them to stop the wire transfer if possible. They may also be able to assist the authorities in tracing the money.
- Report the fraud to the authorities: You can file a complaint with the FBI's Internet Crime Complaint Center (IC3) at https://www.ic3.gov/. You can also contact your local law enforcement to report a crime.
- Keep records of all communication with the scammers: This includes emails, text messages, and phone calls. These records could be helpful to the authorities in their investigation.
Your Role: The Final Safeguard
While GreenStone and other financial institutions take measures to help secure wire transactions, the ultimate responsibility lies with you. You are the final safeguard against wire fraud. By being aware of the risks, being vigilant, and taking proactive steps, you can significantly reduce your risk of falling prey to wire fraud.
- Be aware of the latest wire fraud: Scammers are constantly evolving their tactics, so it is important to stay up to date on the latest frauds.
- Be vigilant: Do not rush into sending money. If something does not seem right, it is not.
- Take proactive steps: Do not wait for something to happen. Take steps to protect yourself, such as verifying the recipient's information carefully and using a secure payment method.
By following these tips, you can help to protect yourself from wire fraud. Remember, you are the final safeguard.
References
CertifID. (2022). State of Wire Fraud: 2022 Trends and Industry Forecasts. Retrieved from https://www.certifid.com/state-of-wire-fraud-2022
To view the article in the online 2023 Fall Partners Magazine, click here.
