Wire Transfers Are Scam Signs

By: AARP Education & Outreach | Source: AARP.org | January 24, 2007

Many scams today have one feature in common. They all tell you to send money by wire transfer before you receive anything. This can be a way to lose money quickly. Once the money is paid out, you cannot get it back. Scammers want to get your money by wire because it is the fastest way to steal your money and not get caught.

Scams to Watch Out For

Note what all the scams have in common:

• A caller says you have won a sweepstakes, prize or lottery but you must wire money before you can claim your prize. The scam? There is no sweepstakes or prize. You haven't won anything, but you'll lose the money you wire.
• You get an unexpected letter or email that offers you an expensive, rare or hard to find item for an unbelievable low price that you can only pay for by wire transfer. The scam? You'll never receive the item, or, if you do, it's not worth what you paid for it.
• You get an email from an "official" in Nigeria or another foreign country. The writer wants to transfer a large sum of money out of his foreign bank account into your personal bank account. In turn, you will be expected to wire some money back to him. The scam? There is no foreign money; just a money-making ploy.
• You are offered a loan or credit card, but the company says you must pay a fee by wire transfer before you get the loan or credit card. The scam? Legitimate companies don't operate this way. You'll never receive the loan or credit card.
• You get a call from someone who claims to be from law enforcement or a hospital. They say a friend or relative had an accident or was arrested and tell you to wire money immediately to help them. The scam? Real law enforcement officials and hospitals don't ask for wire transfers. You've sent money you'll never see again.
• You answer a help wanted ad but the employer says you must wire transfer money to pay for uniforms or other fees before you can start work. The scam? There are no uniforms and no job.
• You offer an item for sale on the Internet or newspaper. Someone says they will buy but will have to pay for it with a check made out for more than the sale price. The buyer wants you to deposit the check and wire the difference. The scam? The check you receive is fake and your bank may come after you for the total amount of the phony check. You're out both the amount of the fake check and the amount you send by wire, plus a bundle of bounced check fees.

In each of these scams, tricksters want you to wire the money so they can get your money fast. You lose control of your money and can't get it back.

Tips to Avoid Entangling Wires

Don't send money if a caller requires you to send money "right now!"

Don't send money to someone who tells you what to say to the wire transfer agent, or says you should hide information or lie to the agent.

Don't wire money to someone you don't know well. After your money is paid, you will not get it back.

Don't wire money to pay for an item you bought from an online auction. It's safer to stop the transaction than lose your money before you get the item.

Do ask the clerk to stop your transaction immediately if you just sent a money transfer and think you might be a fraud victim.

Take Action

• Learn more about how the Nigerian scam works so you can avoid it.
• If you feel you have been the victim of fraud via the Internet you can report it to the Internet Crime Complaint Center.
• If you are uncertain or suspicious of a telephone, paper mail or email solicitation, contact your state Attorney General's department of consumer affairs.
• If you think an online auction is fraudulent, report it to the Federal Trade Commission.
• Genuine postal money orders have important security features. Know how to detect a counterfeit.
• If you are concerned about someone wanting you to send money to Canada, call the Canadian PhoneBusters anti-fraud call center at 1-888-495-8501.
• If you lost money to people who say they are outside the United States, call your local Secret Service field office.
• The Office of the Comptroller of the Currency has issued guidance to national banks about how to spot fake cashier's check scams and protect their customers from losses.