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How to Spot and Prevent Wire Fraud

Since the rise of technology, there are a number of tactics used by scammers to steal information in hopes of using it fraudulently. One tactic that is repeatedly used by scammers on the internet is wire fraud. Wire fraud is one of the oldest internet scams, as fraudsters want a quick and easy way to manipulate people into handing over their hard-earned money.

Believe it or not, thousands of people are victims of wire fraud every year, and it catches people by surprise. Both individuals and businesses can easily become a victim of wire fraud, which is why we wanted make sure you knew how to protect yourself against these scammers.

Here at Blackhawk, we want you to be on the lookout for scammers trying to access your personal information. Here are ways you can spot and prevent wire fraud so that you don’t put your finances at risk.

What is Wire Fraud?

Wire fraud is when a scammer poses as a trusted source, usually a vendor, company, or family member, and requests an immediate wire transfer of funds. The fraudster will usually play up the urgent need for the funds, often claiming an emergency, as a way to emotionally manipulate the victims. However, the victim soon realizes that they did not send funds to a trusted source and have no way of getting that money back.

If this happens at a place of business, the fraudster could pose as someone in upper management or a company vendor, making them believe that they are sending money to a trusted source.

Additionally, scammers will sometimes pose as a family member or love interest. A classic wire fraud scenario is the “Nigerian Prince” who cannot access funds, and promises a big pay return if the victim wires funds immediately. Scammers have also been known to pose as a distant relative, a grandchild, or maybe someone you have only met briefly. Scammers will create a fake emergency scenario, prompting the victim to wire funds in order to help.

What makes wire fraud so appealing to fraudsters is that they are almost impossible to trace. Wire transfers are immediate, and scammers will often have funds transferred out of the country, leaving the victim with no way to recover the lost funds.

How to Prevent Wire Fraud

One of the best ways you can prevent wire fraud is to never send funds to someone you don’t know. Even if this person claims to be someone famous or fortunate, and has fallen on hard times or unexpected circumstances, this could be a tactic used to manipulate you. Don’t wire funds to someone unless you can confirm their identity. Even if this person claims to be a family member, it is best to call that family member directly and ask if they recently requested a wire transfer. Double-checking who you are sending funds to will help protect your money.

Additionally, make sure you protect your information and never give out personally identifying information to someone over email or text message. Scammers will often try to convince you to give out your bank account number, social security number, or credit card information, and use that to get into your account and wire funds to themselves from your account.

If you are a business, make sure to verify the authenticity of any wire transfer request. Implement a verification process for your employees to follow, making sure you are transferring funds to a legitimate source. A common tactic that is used by scammers is they will pose as a manager or executive at a business, create a fake email address to go along with it, and email an employee asking for a wire transfer of funds. Make sure to educate your employees on the importance of verifying information, especially when it comes to your hard-earned money.

Keeping track of all the ways fraudsters can present scams can get overwhelming, but taking small measures to ensure the validity of a wire transfer can go a long way in keeping your money and information safe.

Here at Blackhawk Bank, our top priority is educating our clients so that they can make the best financial decisions. Want to learn more about how Blackhawk Bank can help you? Contact us today!

 

Author: 

Mathew Reynolds

NMLS#476505

Vice President Retail Banking & Blackhawk Investment Group