Ok, so maybe you don’t, but every day people suddenly discover that they have been used as money mules and were never even aware of it. Money mules participate in the illegal transfer of money. Of course, some know they are participating in criminal activity and, therefore, cannot be considered money mules. They are simply money launderers. However, some individuals have been so cleverly manipulated that they believe they are performing a service rather than a criminal act. They are often shocked to find that what they have been doing is illegal. Others may feel that something isn’t quite right in the activities they’ve been participating in but continue to do them because they need the money or they need the relationship they’ve established.
For the purpose of this post, I only want to concentrate on ignorant money mules. Complicit money mules are simply criminals. Ignorant money mules are usually emotionally manipulated by others. They may be motivated by greed, desperation, sympathy, or affection. In all cases, money mules are involved in aiding in the transfer of illegally acquired money. Mules simply help hide the identity of those behind the original crime.
The criminal manipulation of law abiding citizens into being money mules must be on the rise because the F.B.I, has recently posted a notification on their website.
Five days after the December 4th F.B.I. warning, there was a massive international crackdown on money mules and money mule recruiters. Law enforcement agencies from 31 countries participated in the crackdown which resulted in the arrests of 228 people. More arrests are expected even though many mules are “unaware that the money they are sending is part of an elaborate money laundering scheme.”
So how is it that recruiters convince normal people to do illegal things? First of all, it is necessary to point out that, in the U.S., mule recruiters target senior citizens. This is not to say that money mules are only senior citizens. Anyone can become a victim. The reason senior citizens are targeted is that scammers know they are more likely to fall for scams that younger people may easily see through. In addition, some seniors may need to supplement their income and can’t resist what seems to be an easy way to make some money. Here is a chart from SageVest Wealth Management that highlights this point.
Victims are often recruited by giving them the opportunity to make easy money. Mule recruiters often post jobs on job sites or send out spam emails with job offers. Once given the ‘job’, the victim may be asked by an executive in the company (and it may be in the name of a legitimate company) to help with the transfer of funds to someone who they claim is associated with the business. This information often comes in an email and will appear to come from an actual executive in the company, just in case the victim becomes suspicious and checks out the names of the company hierarchy online. The victim will be told that money will be sent to their bank account and that, if they send it on, they will be allowed to keep a certain percentage of it. Since the scammers are posing as the victim’s employer, they would, naturally, have access to their employees’ bank information so that they could transfer wages into their employees’ bank accounts. Several mule accounts may be linked in a money transfer to obscure the source of the original sender. Recruiters may ask mules to open additional bank accounts and even give them names of businesses to use when making these accounts. This makes the mule believe they are working within an legitimate business network.
In some cases, the recruiter will spend a significant amount of time grooming the victim in order to gain their trust. This is especially true in victims who are targeted through romance scams. Keep in mind that romance scams are the most profitable scam on the internet. Also keep in mind that most romance scam victims are over 40 years old. As the Federal Trade Commission noted earlier this year, “people who said they were ages 40 to 69 reported losing money to romance scams at the highest rates – more than twice the rate of people in their 20s. At the same time, people 70 and over reported the highest individual median losses at $10,000.”
Among these victims was 67-year-old Canadian, Robert Hogg. Hogg was romance-scammed out of more than $732,000. The M.O. was that of a money mule operation with the romance twist. Once Hogg was convinced he had met the love of his life, Sophia Goldstein, a purported Canadian who happened to be on a business trip to Australia, he did whatever she asked him to do. This entailed sending his life savings to a bank in Malaysia. But it didn’t end there. When he ran out of his personal savings, he took out a loan on his house and sent that money to Sophia as well.
Sophia groomed Hogg for a month before she asked for her first money; a mere $2000. This was probably done as a test. Hogg had never wired money anywhere before, but the scammers (Sophia) told him exactly what to do. She even told him he should tell the bank he was wiring money to friends or family members, otherwise, the bank may become suspicious. Later, the bank reported that he changed his story to say that he was building a home in Malaysia. It is not sure if he got this idea from the scammers but, in any event, there is little doubt that Hogg was dealing with experienced professionals.
There are several well-established scammer groups that target individuals through a variety of scams. Once they gain a victim’s trust, and even after emptying the victim’s own bank account, they can use them as money mules. They usually claim that they are involved in a major business deal and need the victim to open some bank accounts that they can use to transfer money. The trusting and loving mule will do as they are told. Robert Hogg died a few months after transferring the last of his money. That’s when the scam was discovered by his family. Sophia did not know of Hogg’s death and continued and is continuing to ask him for more money.
Although romance scams and job scams are two of the most common ways for criminals to recruit mules, they are by no means the only ways. If you own a business, you can be scammed by larger companies that you may be associated with. Actually, it will not be the companies that scam you but someone pretending to be from one of those companies. These scams are getting better every day so it is becoming more difficult to see them for what they are. If your business is asked by an executive of an associated company to transfer money for them, don’t assume the request is legitimate. Call the company that is making this request and don’t call a number that may be supplied with the transfer request.
Mule recruitment through job and romance scams takes place through all social media sites. The F.B.I. gives these warning signs to potential victims.
Money mules can go to prison for up to 20 years. Even ignorant money mules can serve time if the court thinks that the mule had suspicions about their actions or ignored warnings from banks or other authorities. In other words, don’t assume that just because you were used as a tool that you will not have to pay some penalty. Even if the courts decide that you were completely innocent, a bank may close your account, you may be required to refund money, your credit rating may suffer, or you may be unable to open an account in any bank. So, do you really want to be a money mule?