A guest blog by Jackie Blaesi-Freed
Blaesi-Freed is an Assistant Director in the Department of Justice’s Consumer Protection Branch. Today, the Department of Justice, FBI, U.S. Postal Inspection Service and five other federal law enforcement agencies announced the completion of the fourth annual Money Mule Initiative enforcement actions.
When fraudsters located overseas try to swindle U.S. consumers and businesses or steal pandemic-relief funds, a key component of the fraud often is a pretense that the fraudster is physically located in the United States. Whether posing as a fake “lottery official” claiming that a victim has won a large cash prize, pretending to be a vendor, or using a stolen identity to claim unemployment payments, fraudsters know that potential victims are more likely to bite the fraud hook if they are asked to send money to a U.S. address or bank account. Since an overseas perpetrator can’t simply walk into a U.S. bank and obtain an account, many fraudsters use U.S.-based individuals to receive and transmit funds. These individuals are sometimes referred to as “money mules.”
“Money mules” are people located in the United States who, at the direction of someone else, receive stolen funds and forward those funds to others - often other foreign perpetrators. By providing a U.S.-based address, company, or bank account, money mules enable fraudsters to present their victims with a critical illusion – that they are who they purport to be. Some money mules know exactly what they have been asked to do by the fraudster, and understand that, by complying with the request, they are profiting from fraud. Others, however, are victims themselves. While we do not know precisely how much fraud money has passed through mailboxes and bank accounts belonging to money mules, it is safe to say the total amount is in the billions.
For the last four years, federal law enforcement across the country has conducted a campaign each fall that focuses on disrupting fraudsters’ reliance on money mules. This year, the seven agencies involved took action against approximately 4,750 individuals involved in facilitating fraud. These actions, which ranged from interviews and warning letters to criminal prosecution, demonstrate law enforcement’s recognition that not all individuals realize that their actions fuel fraud, and also demonstrate law enforcement’s commitment to using every tool available to us to hamper fraudsters’ efforts.
During this year’s initiative, law enforcement delivered over 4,650 warning letters. These letters informed recipients that their actions are facilitating fraud. We also filed civil cases against individuals who had previously been warned they were facilitating fraud, seeking court orders requiring them to stop their activity. And we brought criminal charges against individuals who knowingly facilitated a wide range of fraud schemes.
Nothing would be more disruptive to fraudsters’ use of money mules, however, than people simply refusing to participate in the activity. Public education on this topic is critical, and a range of federal agencies have materials available to raise awareness about money mule activity.
Here are the key points to know:
- Many individuals who serve as money mules are first victims of other scams, including romance fraud and lottery fraud. Be wary of people you have met over the phone or online, and don’t agree to requests to receive money, packages, or other things of value and forward those items.
- Don’t engage in financial transactions with strangers, and keep your bank account information to yourself. People who serve as money mules often receive payments or packages from strangers across the country—a fact that should send off warning bells, as should any request to let someone else access your bank account or to mail your debit card to another person. Fraudsters may also ask money mules to open a cryptocurrency account.
- Some individuals become money mules after responding to job ads that promise easy money and involve little more than sending or receiving packages. Be cautious when considering such work-at-home opportunities.
If someone realizes that they have become involved in money mule activity, the first step is to end communication with the person giving instructions. It can help to consult with a trusted, well-known friend or family member. If you have given your bank account details or other similar information, alert your financial institution, so that the financial institution can help you take steps to protect your accounts. Report money mule activity to law enforcement, such as the FTC, https://reportfraud.ftc.gov/#/?pid=A , FBI’s IC3, https://www.ic3.gov/ or call the Department of Justice’s Elder Fraud Hotline at 1-833-372-8311, which can not only help with reporting the activity but also can provide the assistance of case managers who are trained to support fraud victims and who may be able to connect you to resources.
By tackling fraudsters’ reliance on U.S.-based individuals who serve as money mules through disruption actions and public education, we can curtail their ability to inflict harm on consumers, businesses, and pandemic-relief funds.
For more information and materials, visit:
- Department of Justice: https://www.justice.gov/civil/consumer-protection-branch/money-mule-initiative
- CFPB: https://www.consumerfinance.gov/ask-cfpb/what-is-a-money-mule-en-2108/ and https://pueblo.gpo.gov/CFPBPubs/CFPBPubs.php?PubID=13526
- FTC: https://www.consumer.ftc.gov/features/pass-it-on/money-mule-scams
- FBI: https://www.fbi.gov/scams-and-safety/common-scams-and-crimes/money-mules