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Top 6 Tips to Avoid Money Transfer Fraud

Updated on Apr 12, 2022
Fraud Prevention

Scammers use cunning ploys to cheat you off your money. One of these is money transfer schemes that have succeeded in robbing people off billions. Scammers love money transfers, since there's no way to refund or stop the transaction nor to trace the money, especially since the scammer can pick up funds from any number of transaction.

Prevention is the only way to protect you. Here are the five most common money scams for you to look out for.

1. Fake Check Scams

Someone sends you a check with instructions to deposit it and wire some or all the money back. The check is fake, but fools bank tellers who send you the money. It may take weeks, before the check turns out to be fraudulent and the bank requires you to return the sum. (Naturally, you cannot track the thief, so the money comes from your own pocket).

2. Advance Fee Loans

Some ads offer you loans or credit cards that disregard your low credit rating or poor work history. They come with attractive rewards and low APR. There's only one problem: Once you inquire, you're told to wire a fee. These offers tend to be scams. Heed them - at your peril.

3. Buying Online

If you're buying something online, and the seller tells you to wire the money, refuse. You'll likely never receive the purchase. Offer the seller an escrow service, your credit card, or another way to pay. If the seller refuses, find someone else.

4. Paying a Telemarketer

The Telemarketing Sales Rule prohibits a rental market to ask you to pay with a cash-to-cash money transfer, like those from MoneyGram and Western Union. Refuse, quote the law and threaten to report if the seller insists.

The One Tip for Avoiding Scams

Suspect money transfer scheme that ask you to wire money to strangers, say a money transfer is the only form of payment they'll accept, ask you to deposit a check and send some of the money back, and seem too good or too quirky to be true. They're likely false.

How to Report a Scam

If you've wired money to a  scam artist, call the money transfer company immediately to report the fraud and file a complaint. Ask for the money transfer to be reversed. It's unlikely that will happen but it's important to ask. If you live in Britain, complain to the Federal Trade Commission (FTC).

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