East Londoners at greatest risk of money laundering scam
New research by Financial Fraud Action UK - the name under which banks co-ordinate their fraud prevention activity, shows that consumers are alarmingly unaware of the fake job recruitment scams criminals are increasingly using to dupe people into assisting them in money laundering activity. Those recruited become 'money mules'. Industry data shows that nearly half of all mule accounts identified in Greater London were located in East London; and 70% of those were based in Newham.
The criminals behind this type of scam are online banking fraudsters. They recruit innocent people to transfer money overseas that has been stolen, typically via phishing scams, from the online bank accounts of UK customers. Most of these fraudsters are located overseas and because cross-border transfers can't be made from UK online bank accounts, a mule is required to receive the stolen money into their account, then send it overseas using a wire transfer service, keeping some for themselves. Criminals tend to recruit their money mules by pretending to offer legitimate jobs via emails, often targeting vulnerable groups such as migrant workers and students, who may be attracted by the lure of a seemingly easy way to make extra cash.
To highlight this growing problem, Financial Fraud Action UK and the National Fraud Authority (NFA) are launching a joint awareness campaign, focused on the London borough of Newham. Findings from a survey commissioned in the borough, reinforce the vulnerability of East Londoners as the data reveals that:
93% of residents do not know what a money mule is, despite the fact that nearly a quarter of residents have either been targeted to be a mule, or know someone else who has
Among those actually approached, men are more likely than women to be targeted to become a mule (60% versus 40%), as are those aged 18-34 years compared to people aged 55+ (54% versus 15%) *
A worrying 27% of people who have been approached to become a money mule did not know that becoming a money mule was illegal and that it carries a prison sentence of up to ten years
Email is the criminal's favourite method of communication for this scam (62% of approaches are made this way)
Most mule approaches (80%) are made by strangers
Men and those aged 18-34 were the most tempted to become a mule
Only half (57%) of the people surveyed would definitely be suspicious if they were overpaid for easy work and just under half would not be put off by a job advert containing spelling or grammatical mistakes
Thirteen per cent of people wouldn't bother to research a potential employer before taking a job or handing over their bank account details
More than 60% of the people polled did not know that you could get a prison sentence, or other punishment, for becoming a mule
86% of people approached to become a money mule have failed to report it
Katy Worobec, Head of Fraud Control, Financial Fraud Action says: "These results make for a worrying read. It is concerning that awareness of this scam is extremely low in an area where nearly a quarter of residents have been approached for mule recruitment. The survey also clearly demonstrates that consumers are not reacting seriously enough to the potential warning signs - such as job offers that offer minimum work and maximum reward. "
"Whilst criminals are currently focusing on East Londoners, this problem is a national one and nobody can afford to be complacent. We hope this campaign raises widespread awareness so that consumers are able to protect themselves from becoming a victim of this serious crime - which can carry a prison sentence of up to ten years. "
Dr Bernard Herdan, CEO of National Fraud Association (NFA) says: "The National Fraud Authority fully supports the work Financial Fraud Action UK is doing to raise awareness of this serious issue. The NFA urges anyone looking for work to scrutinise potential job offers carefully, so as to avoid paying the ultimate price - a prison sentence of up to 10 years."
Advice to consumers to help minimise their chances of being a victim is:
Be very cautious of unsolicited job offers or opportunities to make easy money
Be especially wary of job offers from people or companies overseas as it will be harder for you to find out if they really are legitimate
Verify any company which makes you a job offer and check their contact details (address, phone number, email address and website) are correct and whether they are registered in the UK
Be suspicious of job adverts that are written in poor English, with grammatical and spelling mistakes
Never give your bank details to anyone unless you know and trust them