Avoiding Wire Transfer Fraud | New Tripoli Bank
Log In× Close

Avoiding Wire Transfer Fraud

Take steps to protect yourself from these common wire transfer scams.

Wire transfers are a quick and simple method of transferring money between individuals and businesses. However, they are also a common target of fraud due to the speed at which they are processed and the difficulty of undoing a transfer. According to FBI statistics, roughly $12 billion was lost to wire transfer fraud between October 2013 and May 2018. To better protect yourself from fraud, it's important to be aware of common scams involving wire transfers.

Phishing Scams

Phishing is an attempt to obtain sensitive information, such as your user name, password, and other account details, by posing as a reputable individual or company via email, text message, phone call, or through social media. After obtaining the needed information, the scammer can use the stolen details to access your accounts and steal your money.

These scammers will use compelling language, such as implying imminent risk to your personal or financial safety or security, to convince you to reveal sensitive information. They will often find ways to mask their true identity and gain your trust, like mimicking a real company's logo in an email or "spoofing" their phone number so caller ID will display the name of a real business.

Some best practices you can follow to avoid these scams:

  • If you receive a suspicious email or text message, avoid clicking links, opening attachments, or offering sensitive account or personal information, even if the sender claims to be from a reputable business.
  • Make sure to keep your anti-virus software and system security patched and up-to-date on your computer and mobile devices (smart phones are basically tiny specialized computers, after all).
  • Disable automatic downloads on your mobile device and computers so you don't accidentally download malware or spyware.

Family Emergency Scams

This scam is exactly what it sounds like: you receive a phone call, text message, or email from someone claiming to be a friend or family member who's in an emergency that requires you to send money. The scammer will often already have some specific personal information about you or the person they're pretending to be in order to convince you of their authenticity. This scam preys on your emotions through emphasizing the immediacy of the request in order to coerce you into initiating a wire transfer.

Some best practices you can follow to avoid these scams:

  • Be wary of sending money to "friends" and "family" until you have confirmed their identity and that it's a legitimate request. You should ask for information not readily available to the public (i.e. anything you could find on social media) to verify their identity.
  • Hang up if you feel uncomfortable or threatened, especially if you didn't initiate the call.
  • After ending contact with a potential scammer, reach out to the friend or family member directly to verify the request was legitimate.

IRS Fraud Scams

These scams tend to increase in frequency during tax season and often lead to identity theft and tax fraud. An IRS-related scam can take many forms, including fake tax notices or fraudulent phone calls. Some scammers will impersonate IRS agents and contact you about owing taxes or claiming you have a tax refund to collect.

The best way to avoid falling victim to these types of scams is to familiarize yourself with the IRS' standards of tax collection:

  • The IRS will always contact you via mail (not email, text messages, or via social media).
  • You always have an opportunity to appeal a tax notice; the IRS will never demand immediate payment of your taxes.
  • The IRS does not ask for payments via wire transfer.
  • Any threats to have you arrested are an huge red flag! The IRS can refer investigations to law enforcement for review but cannot have you immediately arrested for not paying your taxes.
  • The IRS uses a standard set of account instructions for wire transfers, using the routing number #091036164 with the name "US TREAS SINGLE TX." If you see a different account information, contact the IRS for more information and verification.

To review your tax standing, you can visit the IRS website.

General Safety Tips

A wire transfer is an immediate form of payment. Because of this, as soon as a scammer obtains any funds you've wired in exchange for a check, the wire transfer cannot be reversed, even if the check is fraudulent. It is for this reason that it is essential for you to take precautions that reduce your risk of fraud!

Here are some general rules of thumb to follow to protect yourself from fraud:

  • Never send funds to an individual or business you don't know personally.
  • Be skeptical of any claims that your payment will cover a loved one's personal expenses, fees for lottery winnings, and other scenarios.
  • A common scam involves asking you to deposit a fraudulent check, then later stating that a portion of the check was extra money for commission or an over-payment and asking you to wire transfer the difference back to the sender. If the check bounces, you could be on the hook for a lot of money.
  • Double-check the information you've provided in any wire transfer before sending. A single error could send the funds to the wrong person or business.

If at any time you suspect fraudulent activity, you should immediately report it to the Federal Trade Commission (FTC) at https://reportfraud.ftc.gov/ or call 1-877-FTC-HELP.

You can learn more about fraud protection and security by visiting our Resource Center.