Friday, October 24, 2014

Money Wiring Fraud Prevention Tips

Money wiring services and reloadable debit cards are still criminals’ payment method of choice when it comes to raking in their ill-gotten gains from scam victims.
So much so, in fact, that a couple of the big money wiring companies themselves have agreed to pay compensation of $200 million to reimburse victims, and one of the leading debit card firms has announced that it will abandon its main reloadable card in 2015.
The attraction to the crooks is simple: Both payment methods are untraceable. Law enforcement is usually unable to track down where the money went.
Wiring and reloadable cards are, of course, perfectly legal and play a very useful role in legitimate money transfers and payments.
But they’re also perfect for scams, like:
  • Advance payment (where victims get a dud check and are asked to wire part of the value to a scammer-in-disguise, before the check “bounces”).
  • Distress scams (where victims receive a bogus message from a relative, friend or colleague who is supposedly in trouble and urgently needs cash).
  • Lottery scams (where victims are told they must pay tax and processing fees before they can collect their — non-existent — winnings).
  • Phony fines and overdue bill demands, most recently the widespread IRS unpaid-tax-bill scam.
You’d think that the people who provide these payment methods would be able to spot a scam when a victim comes up to them and tries to transfer money — especially to someone in countries where the crooks operate.
Actually, they sometimes do manage to stop people, mostly in their 80s and beyond, before they pay up.
But consumer organizations, notably the Federal Trade Commission, have been critical in the past, suggesting they could do more, which is why some of them have agreed both to hand money back to victims and to be monitored by the FTC.
Today, all the big money wiring companies provide guidance on their sites to try to steer customers clear of potential scams. We covered the broad details of these guidelines in an earlier issue, The Golden Rule that Halts Money Wiring Scams.
The biggest wirer, Western Union, now offers these 8 simple rules on their site to prevent fraud:

  1. Never send money to people you haven’t met in person.
  2. Never send money to pay for taxes or fees on lottery or prize winnings.
  3. Never use a test question as an additional security measure to protect your transaction.
  4. Never provide your banking information to people or businesses you don’t know.
  5. Never send money in advance to obtain a loan or credit card.
  6. Never send money for an emergency situation without verifying that it’s a real emergency.
  7. Never send funds from a check in your account until it officially clears, which can take weeks.
  8. Never send a money transfer for online purchases.      from 10/22/14