Money Mules: How Criminals Move Money Overseas

Brief History

Most people are familiar with the “Nigerian Prince” scams of the 1990’s.  What many don’t realize is that these “419” scams are the precursors to today’s business email compromise (wire fraud) scams. 

While the geography of wire fraud has greatly expanded over the last few years, many wire fraud criminals are still located in Nigeria.  Given the prevalence of the “Prince” scams, most people (and banks) are extra alert when sending transactions anywhere overseas.  So, how are these criminals still so successful given all of the attention and protections when sending money overseas? By using money mules!

Mules

Drug mules are used to smuggle drugs into a country and are not involved in the manufacturing or selling.  Similarly, money mules provide American bank accounts as a stepping-stone to the ultimate criminal overseas, making the transfer of money (from victim to US-based mule) seem legitimate. The mule then transfers the money to the international scammers, usually keeping a small cut of the money.

Unlike drug mules, money mules are typically unaware (or have plausible deniability) of the larger scam.  Mules are typically recruited through internet “work from home” ads or are duped through a romance scam.  In the romance scam, the “mule farmer” will feign interest in a partner.  Once the mule’s trust is secured, they will be asked to receive and send money in their personal bank account as a favor to their “boyfriend/girlfriend.”

Here is an example: During the pandemic, John Doe sees an ad that claims he can make up to $10,000 per month while working from home.  The job requires him to do very little: he provides his bank account information and downloads a piece of software that alerts him when a transaction is ready.  When the scammers find a victim, they provide the victim with John’s bank account information. 

At this point, John gets an alert and monitors his bank account.  Once the money arrives, John transfers it from his account to the international account (or a cryptocurrency exchange) provided by his “employer.”  John is unaware that he is part of a wire fraud scam.

So what does this mean:

“The majority of wire fraud cases involve domestic bank accounts, as opposed to foreign transfers.  Treat every first-time transfer as risky as if it were an international wire.”

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