Beware Money Mules

Article by Phil

We have been warning about the uptake in scams and scam activity over the last few years and increasingly since the lockdowns started.  But now there is a new kid on the financial crime block “the Money Mule”.

Money Mules are willing or sometimes “unwitting” individuals who allow criminals to use their legitimate bank accounts to funnel money from criminal activity through their accounts and out the other side, in return for a cut or commission from the proceeds. Once money has passed through a legitimate bank account it’s starting to the process of being layered or cleaned up. It is not always cash that is filtered through accounts, sometimes it is cryptocurrencies (which we’ve commented on before) or even simple things like gift cards being purchased (which are later exchanged for goods, which can then be re-sold again).

The number of Money Mules has increased over the course of the pandemic according to latest figures from CIFAS the UK Fraud service, who report a particular increase in activity in the 21 to 30 age group, which is up 5%.

I hadn’t realised just what a problem this was, with over 40,000 case reported in 2020 alone.

These younger “Mules” are now being recruited online with the offer of jobs like local money processors or money transfer specialists. There is some suggestion that younger people are being targeted because of the growing levels of financial inequality which are emerging.

Recent research by First Direct showed that 18- to 24-year-olds had the most “unhealthy relationship” with money, compared to the over 55’s who had the best relationship. This is in line with recent data from the Financial Conduct Authority who estimated that up to 12 million people were struggling because of the recent lockdowns and their effects.

So please be aware of these new scams. The penalties for participating are serious including prison and serious damage to credit references.

Don’t let anyone you know get caught out.

Although you could be forgiven for wondering just how well managed the financial crime protection services are. News just in this week that the FCA is acting against Nat West for failing to follow the Money Laundering regulations by allegedly allowing over £365 million in cash to be deposited into a series of business accounts over a 30-day period in 2016. Barely believable.

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