FRAUD WATCH When Your Bank Is Where the Money Lands By SCOTT ANCHIN Senior Vice President, Strategic Initiatives and Policy, ICBA Community banks have built strong fraud-prevention practices for customers sending money out. Tellers are trained to spot unusual wires. Verification thresholds catch large transfers. Conversations at the counter give customers who have been groomed by fraudsters the chance to reconsider their transactions. This work has long put community banks on the front lines of fraud prevention, but it captures only one side of the problem. The other side is inbound activity. Investment fraud, romance scams and online extortion schemes all produce money that must land somewhere before it can move on. Sometimes, it lands at community banks. A fraud network recruits a money mule, someone to move money on their behalf, either knowingly or unknowingly, through a job posting, a relationship or coercion. The mule opens an account, presenting documentation that looks routine. The account receives inbound transfers from victims at other institutions, sent at the fraudster’s direction. Within days or even hours, the funds move, often to cryptocurrency exchanges or 16 In Touch
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