Criminals are always coming up with new ways to get their hands on others’ hard-earned cash. Often, to protect their own identity, they rely on others to help them move money around. When someone follows the instructions of a fraudster to receive and move money that was given to them fraudulently, they’re what’s known as a “money mule.”
Read on to learn more about how people are targeted as money mules, how it helps fraudulent activity, and what to do if you were asked to perform activities that result in you becoming a money mule.
Money mules can be part of many different types of scams. Some examples include online job postings, sweepstakes “winnings,” online dating sites, or social media posts.
Exactly what money mules are asked to do varies based on the type of fraud they’re being targeted with. In general, though, all these scams work in a similar fashion. An individual is asked to receive money and then pass it on to someone else.
Be thoughtful in the opportunities you seek out online and practice extra caution when it comes to dealing with finances. There are some common red flags of money mule scams, such as:
Someone telling you they’re sending you money to pass on to another person
Being asked to allow someone else to deposit cash into your financial account
Getting instructions to receive a package and send it on to someone else
Receiving instructions to wire money
Being told to send payments in the form of gift cards or virtual currency
The first step is to stop communicating with the person who has asked you to move money around on their behalf. The next step may depend on how far into the scam you are.
If you haven’t taken any action other than talking to the fraudster, report the communications and suspicious activity to your local police.
If you’ve taken action, such as receiving cash, you should not complete the activity you were asked to do and notify your financial institution and law enforcement.
For more information on specific money mule scams, check out our blog.