The US Financial Crime Enforcement Network (FinCen) analysed COVID-19-related reports made under the BSA to identify red flag indicators for two forms of consumer fraud frequently observed during the pandemic: imposter scams and money mule schemes.
In imposter scams, criminals impersonate organisations such as government agencies, non-profit groups, universities, or charities to offer fraudulent services or otherwise defraud victims. FinCen notes these often involve: (1) contacting a target under the false pretence of representing an official organisation, and (2) coercing or convincing the target to provide funds or valuable information, infecting the target’s computer with malware, or causing the target to spread disinformation.
Banks should look out for customers who claim to have been contacted by the government by phone, or received unsolicited emails related to stimulus payments or seeking donations to charities that do not have an in-depth online presence or history.
According to FinCen, a money mule is "a person who transfers illegally acquired money on behalf of or at the direction of another." Throughout the pandemic, this has included both witting and unwitting participants. Fraudsters have been targeting individuals promising easy money, or have claimed to be US citizens stuck abroad and needing help to send money back home.
Banks should be alert to financial transactions that don't fit the customer's history and profile, or receive multiple stimulus or unemployment payments from different sources, as well as customers who claim to be receiving and making payments on behalf of their employer or another person.
Banks should follow the SAR guidance to report COVID-19-related crime.
The Financial Crimes Enforcement Network (FinCEN) is issuing this advisory to alert financial institutions to potential indicators of imposter scams and money mule schemes, which are two forms of consumer fraud observed during the COVID-19 pandemic. Many illicit actors are engaged in fraudulent schemes that exploit vulnerabilities created by the pandemic.