Updated on
Jan, 17 2024
Iryna Berenstein
Written by
Kendall Coffey
Researched by

What are the Risks of Money Mules?

Money mules knowingly or unknowingly help criminal gangs launder illegal funds or profits. Fraud happens by providing your bank account to receive and transfer fraudulent funds, legitimizing it.

Organized crime relies on money laundering to hide the origin of illegal funds. The main aim is to make money seem legal while protecting criminal groups from prosecution for illegal activities. Since they do these activities discreetly, it makes it hard to trace money trails by law enforcement.

There is a need to raise awareness among people to help curb this threat. So INTERPOL launched the #YourAccountYourCrime program that ran between the 10th and 26th of August 2022. The program helped raise awareness of money mules and gave people tips for staying safe.

What Is a Money Mule?

A money mule refers to an individual who operates as a mediator for the transfer of illegally earned money on another person’s behalf.

Offenders frequently solicit money mules to assist in the purification of funds obtained as a result of virtual scams, fraudulent actions, or offenses including human smuggling or narcotics trafficking. The use of financial couriers generates multiple layers of space between the criminals and their victims, making it excessively difficult for legal authorities to trace the flow of money accurately.

Numerous mechanisms are employed by money mules in the fund’s movement, encompassing bank deposits, bank draft checks, digital currencies, preloaded debit cards, or funds transfer services.

A section of these money mules are conscious of their contributions to criminal activities, while others remain oblivious to their role in supporting these illegal profits. Financial couriers usually earn a fee for their services but may also participate due to a perceived trustworthy or passionate bond with the person soliciting assistance. If you execute financial transactions under the instructions of another entity, you could potentially be functioning as a financial courier.

How are Money Mules Recruited?

Criminal gangs recruit money mules in various ways. For example, criminals trick some people with the promise of financial gains, such as receiving commission fees for their service. Others prey on peoples’ need for romance and thereby support the person they believe to be in love with.

The #YourAccountYourCrime program focused on four key areas of how criminal gangs recently recruit money mules:

  • Job scams

A scammer contacts you about a new job offer, even without applying for the position. The employer doesn’t provide information about the job offered. If you are not keen, they will deceive you.

  • Romance scams

Scammers contact people through social media platforms or dating platforms. The person contacting you is in pursuit of a romantic relationship with you.

  • Investment scams

Most people fall prey to these investment scams. You receive a message about big returns on investment.

  • Impersonation scams

You receive calls from individuals pretending to be from courier services or government agencies requesting your banking details.

What are the Tips to Avoid Becoming a Money Mule Victim?

It’s easy to become a money mule victim; however, you must stay alert and keep these tips in mind.

  • Be suspicious of promises to receive funds in exchange for transferring funds through your account. No legitimate company will ask you to do this. Also, please refrain from responding to job adverts that promise hefty rewards for minimum effort, as it’s likely to be a scam.
  • Never open a bank account with your details on behalf of someone else. Also, never accept that someone uses your bank account for personal transactions.
  • Before applying for any advertised job, do thorough research. Check if contacts are genuine and if they have a company website. By doing your research, you will have a good idea about whether the job opportunity is real.
  • If a criminal convinces you to make a money transfer, getting your money back won’t be easy. Getting money back from a scam is difficult, unlike fraud, as scammers take money against your knowledge. Most scams will require you to actively participate, e.g. sharing your bank details or transferring money.

What Industries Do Money Mules Target?

Money mules tend to operate across various industries, with particular concentration observed in sectors that handle numerous financial transactions, like banking, financial services, and digital commerce. Wrongdoers who launder their illicit funds via money mules often pinpoint individuals employed in or having access to these sectors’ bank accounts or monetary systems.

Legally, all businesses that fall under anti-money laundering legislative policies must implement measures to counteract the practices of financial couriers and money laundering as a whole. As an example:

  • Building societies and financial entities
  • Investment firms and fintech
  • iGaming businesses
  • Real Estate agents
  • Foreign exchange and digital currency traders

Local laws dictate which organizations must comply with anti-money laundering (AML) regulations. This typically applies to entities involved in storing, transferring, or facilitating the large-scale financial movements for individuals or businesses. It’s not exclusive to banking institutes. For example, online gaming platforms are frequently preyed upon by money-laundering culprits.

Final Thoughts

Criminals are experts in impersonating people, police and government agencies. Hence it can be hard to spot a scam text, email or phone call. However, there are certain things that you can do to protect yourself. For example, if someone asks for your personal or banking information, be direct and say NO.

Iryna Berenstein
Iryna Berenstein
Mrs. Berenstein is a distinguished and outstanding lawyer with profound experience and exceptional legal knowledge in the field of International Private Law, Financial Law, Corporate Law, investment regulation, Compliance, Data Protection, and Reputation Management. Iryna has an impressive portfolio of private ultra-high net worth clients, mostly from Israel, UAE, the US, and the UK.
whatsup Viber Telegram E-mail
Book a call
Your message send!