Scammers love wire transfers and that makes wiring money risky. It involves sending money out hopefully into the hands of the intended recipient. However, sometimes criminals abuse this simple and fast way to send money. Protect yourself from becoming a victim of wire fraud by exercising caution every time you send money.
Just like cash, you can’t get the money back when you wire money. To reduce your risk, don't send money to someone you do not know or have never met in person. Be aware of scams and suspicious requests for money. Never wire money to someone to replace a check they wrote you. The check could be bad -- but the cash you sent in return was good. Wire transfers pose the greatest risk to the sender.
Anytime you are asked to wire someone money, it should raise a red flag. Scammers come up with all kinds of stories to get you to agree to wire them money. It can be difficult to know when something is fraudulent. Beware of any offers or requests that seem too good to be true -- they usually are. While new scams pop up from time-to-time, past scams include bank account takeovers, lottery scams, job scams, check-cashing scams, wire-back scams and charity scams.
Now you see it -- now you don't. Trojans or malware can give a thief access to your online bank account, allowing them to initiate a wire transfer from your account. The culprit could be anywhere in the world. Update your computer regularly, maintain your computer's antivirus software, avoid logging into your bank account from public computers and be wary of the websites you visit from your own computer. Some financial institutions track your spending and online behavior to try to circumvent any suspicious activity on your account. Some banks may freeze your account until you confirm the activity.
International wire transfers are associated with money laundering and funding terrorists. The government has enacted several laws to protect individuals and the nation from these risks, but risks remain. Banks have taken on a bigger role in monitoring wire transfers, including familiarizing themselves with the customers of the bank's customers. The bank should be aware of who is sending money -- and who is receiving it.
Research your bank – including the security measures they have in place. You could be held liable for fraudulent wire transfers. Paypal is an alternative method of sending money quickly, to anywhere, and may be more secure. It may even be less expensive. If a thief has scammed you, report it. First, call the money transfer company and ask for a reversal of the transfer, and then file a complaint with the FTC.
- MoneyGram: Frequently Asked Questions
- Western Union: Online Fraud
- The Last Watchdog: Wire Transfer Risks – Why Banks Will Not Reimburse Fraudulent ACH Cash Transfers
- AML-CFT: Money Laundering Risks in International Wires
- Wells Fargo: Sending and Receiving International Payments
- Payments101: Understanding Today’s Wire Transfer Risks
- Fraud Avengers: Payment Fraud Scams
- Next Avenue: Avoid the Risks of Sending a Money Transfer
- Forbes: Faster, Better, Cheaper Ways to Transfer Money – Chapter 1 Paypal
- Keith Brofsky/Photodisc/Getty Images
- How to Track a Wire Through the Federal Reserve Bank
- What Is the Time Frame for Reversing a Wire Transfer?
- U.S. Bank Transfer Limits
- Rules for ACH Reversal
- How to Set Up a Brokerage Account
- What Can You Do When a Business Takes Money Out of Your Account Without Authorization?
- Certified Check Vs. Money Order
- What Is the Bank's Liability If There Is Identity Theft?