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Safety & Security

What Are the Warning Signs of Wire Transfer Fraud?

Know how to recognize the warning signs of wire transfer fraud:

  1. Someone that you have never met in person is asking for money. This is the biggest red flag for fraud. If you’re in a long-distance relationship with someone you’ve never met in person, be wary of possible fraud, if they start asking for money. The reality is: fraudsters are professionals and they’ll do whatever it takes to get their hands on your cash. When it comes to that new love, overseas inheritance or investment opportunity, it’s worth the cost of the plane ticket to ensure it’s legit. If you can’t meet them in person, you should think twice before sending your money.
  2. You receive an email that claims you’ve won a jackpot but you have to pay fees before you can receive the prize. The reality is: the fraudsters are the ones hitting the jackpot. If it sounds too good to be true, it probably is.
  3. You see an ad online for a great deal, but you’re required to transfer the money right away to receive the product. The reality is: the product doesn’t exist and they just want your money. While many people use wire transfers to pay for luxury items, it’s worth checking the reputation of the seller, if you’re transferring a large sum.
  4. You get a job as a mystery shopper but they send you a check for more than what you’re owed. You’re asked to send the excess funds back via wire transfer. The reality is: this is just a clever way to steal your cash, as the check is probably fake.
  5. You receive an email from someone pretending to be your bank or other service provider saying you need to update your security info. The reality is: as soon as you click the link, you’re vulnerable to malware. Phishing emails that try to steal your information or get you to wire money will often contain a lot of spelling and grammatical errors. The email might not address you by name, and it comes from a suspicious and unrecognizable source. It will probably ask you to provide financial information or to verify it, but if you hover over a URL, you’ll see that it will take you to a suspicious and unknown website. Don’t click on any links within these emails; instead, just delete them and block the sender.  
  6. You receive an email or a phone call that claims the IRS wants you to pay back taxes, and you need to transfer your money or you’ll be arrested. The reality is: the IRS will formally contact you by mail rather than by phone, and they won’t be asking for your payments by credit card or by wire transfer either. 

What not to worry about 

When you see a warning signs for wire transfer fraud, the good news is that you can protect yourself by being alert to typical scams and taking some simple self-protection steps. If you do need to wire money overseas, using a reputable provider like OFX will get your money where it needs to be safely and securely.

 

At OFX, we’ve taken a multi-layered approach to your security because we don’t want you to fall victim to scammers. A combination of SSL encryption, fraud prevention, and identity protection means you can enjoy the benefits of our services while resting easy. So tell those scammers to scram because you’re too smart to be fooled by their tricks.   



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Is It Safe to Wire Money?

Wire transfers are one of the most efficient ways to transfer money overseas, but is it safe to wire money? The simple answer is yes. Usually.

The biggest risk to your money could be you

According to the FDIC, “Using a bank or a money transfer company to "wire" funds electronically is an easy and convenient way to send cash to someone. And when consumers wire money to people they know, the transaction typically takes place without a problem. But wiring money to strangers [...] is risky because often they could be scam artists.”1

The risks associated with wiring money are, in part, a result of the efficiency of the method for sending funds. Wire transfers can often be completed within one business day by providers like OFX. But once the funds are received by the overseas party, it’s very difficult to retrieve them if you discover a problem. 

How can you stay safe when wiring money?

You can increase the safety of your money wire by following some simple guidelines:

 

  • Avoid wiring money to someone you’ve never met in person.

  • If you need to pay people you’ve never met like overseas suppliers, verify their business credentials through phone calls, online reviews and other means. This is to ensure you are dealing with the company itself and not an imposter pretending to be your supplier.

  • Be especially cautious when wiring money to someone who first contacted you via email or dating service.

  • Choose a money transfer provider with a dedicated fraud prevention team like OFX.

  • If you are wiring money for an investment, check with the local securities commission to see if the investment company is regulated. You can check who regulates them by going to the IOSCO (International Organization of Securities Commissions) website. Then, you can contact the appropriate overseas regulator or search its website to ensure that a company of that name is registered or licensed.

  • Be careful when donating to independent charities who may lack the oversight of larger organisations and who may not be what they claim. Do some research before you give. Check the organization’s identity and tax status before you donate. 

Is it safe to wire money with your bank?

As discussed above, wiring money with your bank will not necessarily make your transfer safer and using your bank could cost you a lot. Banks often take a margin of 5% over the daily exchange rate when they send your money overseas. That means on a wire transfer of $10,000 you could be paying up to $500 in addition to hefty ‘international transaction’ fees. At OFX, we think that’s too much. When you register with us, you might save hundreds on a similar transfer of $10,000.

 

So is it safe to wire money? Yes, as long as you take some simple precautions to protect yourself from unknown recipients and high bank fees.

 

You might also like:

What is a SWIFT code?

AUD/EUR Exchange Rate

 

 

Sources:

  1. https://www.fdic.gov/consumers/consumer/news/cnsum13/wire-transfer-scams.html


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