Wire Transfer Scam

Don't get taken. Protect yourself from wire transfer scams.

Wire transfer scams are popular with shady operators. According to Washington State Attorney General Rob McKenna, "U.S. consumers lose millions of dollars each year to fraudsters using wire transfers as part of their scams." Almost all wire transfer scams either involve using a fake check as bait or requesting account numbers for a bank account. It is important that you learn how to recognize the variations on these scams to protect yourself from fraud.

Fake Jobs

One common form of wire transfer fraud is to prey on job seekers with an offer of phony employment. For example, you may be told you're to process payments for clients. This scam involves sending you checks to be used in the commission of your job. The checks include an additional amount that you are supposed to keep as your payment; you are instructed to wire the rest to an account. By the time the original check bounces, the transferred funds are long gone.

Fake Buyers

Another scam is commonly directed toward individuals selling items on auction sites. A con artist will tell you she needs to write the check for more than the amount of the sale and asks you to wire the extra funds to an account. If this type of scam works, the thief gets the extra funds and the item while you get stuck with a bad check and bank fees. She may also write you a bad check and back out, demanding a refund. You pay the refund and find out the check is bad weeks later.

Sweepstakes and Lotteries

If you've received a notification claiming you won a sweepstakes or lottery, you may be at risk for wire fraud. Upon contacting someone to ask how to collect your gift or winnings, you will be asked to pay for the taxes or shipping fees before the company can send you the prize. The thief may also tell you that he needs your bank account numbers to deposit the winnings, allowing him to clean out your accounts.

Fake Items and Loans

Another scam involves offering loans or items that don't exist. Con artists pretending to sell items may insist on payment by wire transfer for items you will never receive. Fraudulent lenders will ask for a wire transfer to pay for loan processing fees for loans you will never receive. The fake-loan scheme often also involves a request for your bank account information, supposedly to transfer the funds into your account.

Nigerian Prince Scams

A well-known version of the wire transfer scam involves a claim by the con artist to be an oppressed member of Nigerian royalty who needs your help. The thieves offer to transfer large sums of money into your account and pay you a handsome fee for letting them do so. The wire transfer that you have to make to receive the larger sum is often described as attorney fees or transfer fees. Requesting your bank account information to transfer the larger sum is also common.

Protecting Yourself

Your bank will likely not take the loss for bad checks or fraudulent wire transfers. Once the money is gone and the check doesn't clear, you will lose your money and have to pay overdraft fees. If you are selling an item, deal locally and insist on cash. Never make any wire transfers to strangers or companies you don't know well, and always protect your account numbers. Don't believe claims of buyer protection from sites like Craigslist.com or Western Union; those companies don't offer protection. Always be careful with work-at-home companies; these opportunities are often scams.

References

• Washington State Office of the Attorney General; Wire Transfer Scams Take Many Forms
• Federal Trade Commission; Giving the Bounce to Counterfeit Check Scams