International police organisation Interpol’s Financial Crime and Anti-Corruption Centre recently ran a global awareness campaign which highlighted the extensive use of money mules in facilitating the laundering and movement of criminal proceeds.
A mule or courier is a person who smuggles contraband to another area or across a border for a criminal organisation or individual. They are recruited, often unwittingly, to transfer funds or goods on the criminal’s behalf, or launder the illicit profits gained from human trafficking, drug trafficking, arms trafficking, illicit trade in wildlife, and other immoral deeds.
The increase in drug mules has in the past been highlighted extensively in the media, as has their often unfortunate fate. Not only are they used to carry the illicit goods, but they also protect the bad guys by taking the fall for them, should they get caught, because of the added distance and more layers between the criminal syndicate and law enforcement.
Money mules provide the same service to criminals. Whether knowingly or not, they play an important role in the distribution and concealment of illicit funds. Because they provide their own accounts for the receipt and transfer of such funds, they lend these processes a degree of legitimacy. However, if things go awry the mule can be found complicit in the criminal activity, even if they were not aware of it – and in many cases, they will be the one who goes to jail.
This is the message of Interpol’s #YourAccountYourCrime campaign, which highlights the fact that the owner of a bank account used for illicit transfer of funds may, if caught, face prosecution.
In May 2022 Interpol published a purple notice warning of the growing use of money mule ‘herders’, who regularly seek blanket authorisations to use the personal accounts of victims as their own. Purple notices are used to seek or provide information on modus operandi, objects, devices, and concealment methods used by criminals.
You bank account is private
The South African Banking Risk Information Centre warns that: “Criminals approach bank customers with requests to have funds paid into their accounts and often offer them a reward for the use of the account. Often the money that is paid into the account is proceeds of another crime.”
And according to Nedbank, allowing another person to have the use of your account could have severe consequences if the transactions are indeed linked to a crime. The account owner could find themselves facing criminal charges and jail time for their involvement. With a tarnished banking record, they could also be blacklisted by banks, meaning they will have no access to a bank account or credit facilities, even if they were unaware at the time that a crime was being committed.
Manie van Schalkwyk, CEO of the Southern African Fraud Prevention Service (SAFPS), says the current economic climate and high inflation rate puts pressure on people as they try to make ends meet. Speaking to SABC News, he says this financial pressure makes people vulnerable to underhanded schemes, especially those which promise a cash reward or a hefty return on investment.
For example, says Interpol, some individuals are lured with the promise of quick financial gain, or they are promised a commission for their service. In other cases, they are motivated by trust or are solicited via online scams. Others provide support because they believe they have a romantic relationship with the individual who is asking for help, or are doing something good for a friend – even if they have never met the friend or romantic interest in person.
Interpol provides some key examples of potential money mule schemes. If you are faced with any of these, do a thorough investigation before you decide to go forward with the request:
- Job scams: you are contacted about a new job without having applied to any position and where the ‘employer’ doesn’t provide any details about their company;
- Romance scams: you are contacted online via social media or a dating platform;
- Investment scams: you receive a message to make big returns on an investment relatively easily;
- Impersonation scams: calls or messages from individuals pretending to be from courier companies or government agencies asking you for your personal/bank details.
“While this should immediately be a red flag, you will be surprised at how many people willingly comply in the hope that they can be of assistance,” says Van Schalkwyk.
“The industry uses various methodologies such as biometrics and verification against the Department of Home Affairs when a bank account is opened. The fraudsters have been caught out so that avenue is closed to them, so they will use somebody else to perpetrate the fraud.”
When it comes to the misuse of accounts through fraudulent conduct, the risk of falling victim to fraud has increased by 97% in the first five months of 2022, compared to the same period recorded in 2021, says SAFPS. The top three categories of fraud are money muling, the use of forged documents, and impersonation.
“This is a significant problem and not only limited to South Africa. Money muling is a significant global risk. Reports from Cifas in the UK point out that money muling funds illegal activities such as money laundering, terrorism, and human trafficking. Obviously, this is concerning, particularly within the South African content,” Van Schalkwyk adds.
How can I avoid falling into the trap?
There is a saying: “If it sounds too good to be true, it usually is.”
In this specific context, we can say with complete certainty that an offer of a generous commission to carry out a simple bank transaction may look good on the surface, but it carries huge risk – even if the person asking for help is a trusted friend or close relative. Unless you know the background to the request and are sure it is for a legitimate purpose, it is always best to not give anyone access to your bank account.
“The person in front of you may be a person who is in genuine need. However, they may also be a fraudster,” says Van Schalkwyk.
Be vigilant of your banking habits, and protect your banking details with care. If criminals get hold of your bank account or credit card number and PIN, they can use the account to deposit money and withdraw their illicit proceeds as well as your hard-earned cash without you knowing. Another good tip is to set alerts whenever money comes into or moves out of your account, so that you will be notified immediately and can act if the transaction appears suspicious.
Interpol offers more advice:
- Before you accept a job offer, check the company’s legitimacy and credibility by looking them up online.
- Beware if an employer asks you to open a new bank account, or transfer money using your own account. Never open a bank account in your name on behalf of another person, no matter what the circumstances.
- Be suspicious of anyone who wants to use your bank account to receive and forward money.
- Never give your financial details to someone you don’t know and trust.
- If you suspect you’ve been used as a money mule, terminate all communication immediately and report the incident to your bank, and to the police.