Before You Hit Send: Wire Fraud
Podcast Transcription
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Hi everyone, welcome to this episode of PFCU's Money Talk Podcast. We have another scam themed episode today. It seems like they never end, but scammers will do anything and everything to get their hands on what does not belong to them. We're going to focus on wire scams today. Scammers pressure you to wire money to them because it's easy to take your money and disappear. Wiring money with services like Moneygram, RIA, Western Union, or even from your financial institution is like sending cash. Once you send it, you usually can't get it back. Never wire money to anyone you haven't met in person, no matter the reason that they give.
So, let's talk about the why. If you need to send money to someone you know and trust, wiring money through these companies or your financial institution can be a useful way to get it there quickly, but scammers will try to get you to wire money to them too. Why is that? Scammers know that once you wire money to them, there's usually no way to get it back. They can quickly pick up your money at any wire transfer company's location throughout the world, and it's nearly impossible to identify who picked up the money or track them down. Scammers can also create fraudulent accounts to collect wire funds at a bank or a credit union. And they know that you are not going to have the same protections that you get by paying with a credit card.
So, here's how to avoid a money wiring scam. Never wire money through companies like MoneyGram, RIA, or Western Union to anyone that you have not met in person. That is a scam no matter what the reason is that they give. Don't wire money to anyone who says that they work at a government agency, like the Federal Trade Commission, the IRS, the Social Security Administration, or the U.S. Customs and Border Protection. The government is never going to ask you to send money this way. Never wire money to anyone who pressures you into paying immediately. Don't wire money to anyone who says a wire transfer is the only way to pay. Never wire money to someone who tries to sell you something over the phone. It's illegal for a telemarketer to ask you to pay with a wire transfer. Or wire money to someone who calls and says they're from your financial institution. Hang up the phone immediately and call your financial institution directly to verify that it was a fraudster.
Okay, so we know the why and we know how to avoid falling victim to this scam. So now let's talk about the common ways that scammers try to convince people to wire money so you can be on the lookout. The first one is apartment and vacation rental scams.
You see an ad for an apartment or for a vacation rental with surprisingly low rent. You reach out and when someone answers, they tell you to wire money. Maybe it could be for an application fee, a security deposit, first month's rent, or a vacation rental fee. Scammers often trick people by putting their own contact information on an apartment or vacation rental ad and photos that they hijacked from someone else. And I'm sure you know what's going to happen next. You wire the money and that person disappears. There was never a vacation rental or an apartment.
Next is a fake check scam. Someone sends you a check and tells you to deposit it. Seems harmless enough. But then they tell you to wire some or all of the money back to them or to another person. Since the money appeared in your bank account, you see it in your account, you do it. But the check is fake. And it can take weeks for the financial institution to figure it out. But when it does, the bank or the credit union is going to want you to repay the money that you took out to complete the wire. And now you're out that money.
So now let's talk about some reasons that someone might try to convince you to deposit a check and then wire the money. They say you've won a prize, and you need to wire money back to cover taxes and fees. The scammer says you got a job that you applied for and send you a check to buy supplies but tell you to wire part of the money back to them or to someone else. They say that the check is part of a mystery shopping assignment to evaluate a wire transfer service, and they will use a check to overpay you for something you're selling online and ask you to wire back the extra money.
Next is a family emergency scam. We have heard these scams before. You get an unexpected or frantic call from someone saying they're a family member or a close friend and they need money to get out of trouble. So, they ask you to wire money to them. But is there really an emergency? Is it really your friend or family calling or someone calling on their behalf? It could very well be a scammer. Scammers call and pretend to be someone you know. And now they're using AI technology to clone the voices of people that you know to make it sound even more real.
Next is prize scams. Scammers create fake prizes, sweepstakes and lotteries. And they say that you've won money or a prize. And there's always some reason they say you have to wire money first, like paying for shipping and handling, taxes or processing fee. But real prizes are free, and this is a scam.
Next, romance scams. We've talked about this one before as well. Scammers create those fake profiles on dating sites, apps and social media. Once they connect with you, they build your trust. They might even talk or message with you several times a day. And eventually they're going to make up a story like saying they have an emergency or want to travel to visit you and to wire them money. More than likely, they're not even the person they say they are. There is no emergency and they're just gonna take your money.
The last one is utility scams. You get a call from someone claiming to be from your gas, water or electric company. They say they'll cut off your services unless you pay immediately through a wire transfer. One of the most common red flags of scammers. They're trying to scare you and create pressure. Real utility companies are not going to do this. And a quick call to your company directly using the number on your bill or on their website, they're going to tell you it's a scam.
So, what do you do if you do wire money to a scammer? It can happen. If you sent money through a wire transfer to a scammer, contact the company that you used right away. So, whether it's MoneyGram, RIA, Western Union, tell them it was a fraudulent transfer and ask them to reverse the wire transfer to get your money back.
If you sent a wire transfer through your financial institution, contact them directly and report the fraudulent transfer. Ask if they can reverse the wire transfer and give your money back. Make sure you're always reporting fraud. If anyone demanded that you wire money, report it to the Federal Trade Commission at reportfraud.ftc.gov. All of this information is provided by the Federal Trade Commission. Go to their website to get more information on other scams and fraud. Thank you so much for listening to this episode. See you next time.
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