Wire transfer fraud: What is it and how to prevent it

Quick insights

A wire transfer may be an efficient way to send funds to a savings or checking account. That said, scammers may use wire transfers to commit fraud. It can be helpful to identify different types of wire transfer fraud to help protect yourself and your funds.

Let’s take a closer look at how you may identify wire transfer fraud.

What is wire transfer fraud?

Wire transfer fraud generally happens when a scammer convinces you to wire them money with deceptive tactics. This may occur without you ever seeing the scammer face-to-face.

Wire transfer fraud can happen because of a safety breach in your account or through deceptive money-requesting methods. Scammers may request money in different ways, so it may be helpful to recognize common schemes in their playbook.

Different kinds of wire transfer fraud

Wire transfer schemes have multiple forms. Some common instances might include:

Unsolicited money requests

If a stranger contacts you out of the blue and asks for a wire transfer, this could be a cause for suspicion. You should not wire money to strangers.

Be aware of people pretending to be someone you may trust, like a banker, coworker or family member. If a wire request seems unusual, even from someone you know, you should verify that it’s legitimate.

Bad checks or digital payments

Sometimes, scammers send you a check in the mail and then say they mistakenly sent you too much. They might ask you to wire some of the funds back to them. Inevitably, the bank will discover that the check is fake and you may lose money if you deposited the check or if you wired any to the scammer.

A similar tactic is when you receive a digital payment through a mobile payment app, where the fraudster claims they sent you money by mistake. They ask you to return it as soon as possible. This is because they’re hoping you send them money back before the app company flags their initial payment to you as fraud and reverses the deposit that was sent to your account.

Romantic interest scams

Another type of fraud is a potential love interest seeking a wire transfer. The scammer might say they want to meet in person. But before traveling to meet you, they may ask you to wire them money for support. However, you shouldn’t send money to anyone you’ve only spoken to online or by phone because it could be a scam.

Identifying wire transfer fraud

Common factors that might indicate wire transfer fraud include:

Preventing wire fraud

Wire transfer fraud may be tricky to identify, even if you know some of the tell-tale signs. You can do your part to prevent it by ignoring unsolicited mail and phone calls, thoroughly verifying the request of a wire transfer and not cashing or depositing checks you aren’t expecting or can’t verify.

Likewise, protecting your bank accounts, peer-to-peer (P2P) payment accounts and contact information is in your best interest. When shopping or browsing online, verify you are on retailers’ official sites before sharing your information, such as email or phone number. In general, create strong passwords such as “passphrases” or consider using a digital password manager to help protect your online accounts.

In conclusion

Wiring funds can be an efficient way to send money, but it is helpful to verify the request and information before doing so. In general, don’t send money to people or businesses without verifying their intentions and identity.

If you’re unsure who is requesting money or whether a request is legitimate, you can also reach out to your bank by calling the number on the back of your card. If someone sends you an unexpected check, verify with your bank to ensure it is a legitimate check before depositing it or wiring funds. You may also want to reach out to other resources, like law enforcement, if you feel something unusual or suspicious is taking place.