How to Avoid Money Wiring Scams

Michael Bennett
October 28, 2015 - 62 Views

When you wire money to someone, using a company like Western Union or MoneyGram, you are basically sending cash. This means that, once it is done, there is no way for you to get it back. It is for this reason that it is so common for a scammer to ask for money to be wired, particularly if the address is overseas. There are very few ways to ever reverse the transfer or to trace who ended up collecting it.

Why Are Money Transfers so Risky?

It can be very useful to transfer money, so long as it is to someone you actually know and trust. If you are asked to send money to someone you don’t actually know, there is a strong possibility that you are being scammed. This is why all law enforcement agencies recommend that you avoid using money transfer services.

The person to whom you wired the money will be able to get his or her hands on it very quickly. For this reason, it is almost impossible for you to reverse it. Once the money has been physically placed in somebody else’s hands, it is basically gone.

How to Avoid Money Wiring Scams

The easiest way to avoid these types of scams is to never wire money to somebody whom you have never met in person. Of course, scammers have become proficient in trying to earn your trust. Hence, be particularly wary of people:

  • Insisting that you must make your payment through wire transfer.
  • You have only met online and claim to love you before asking for money.
  • Advertising vacation rentals or homes online.
  • Claiming to be a potential employer who wants to hire you for mystery shopping.
  • Claiming to represent somebody whom you know. They will inform you that this particular person is in prison in a foreign country and needs your help but begs you not to inform anyone about it.

There are many scam variations. One instance is where you are asked to deposit a check and wire the money back. The check, unfortunately, is fake. Once it bounces, you will be left owing your bank the money you took out and wired to somebody else. A bank has to make check funds available quite rapidly, often before they can check whether or not a check is fake, which means that you can use the money in the meantime. But when the check bounces, you are the one who owes money.

There are countless stories out there and they are often very convincing. Their common denominator, however, is that a stranger is asking you for money and this person wants you to send the money using MoneyGram or Western Union. In almost all cases, you will be the one who lose out.

Common Money Wiring Scams

There are a number of very common money wiring scams. These include:

With work from home scams, you will be told that you can be your own boss doing things like mystery shopping. To take advantage of the opportunity, you will go on shopping tours, for which you will receive a check. After keeping some of the money, you will need to wire the rest back to the company. However, the check will bounce, meaning you are left owing the bank money, as well as being out of pocket for your mystery shopping experience.

With lottery and sweepstakes scams, you will generally be contacted by someone telling you that you have won some sort of foreign lottery. You will be sent a check, after which you will have to pay taxes and processing fees through wire transfer. Again, you will find out later that the check is actually fake.

In family emergency or ‘grandparent’ scams, you receive a message from a frantic stranger who will try to convince you that someone you know or care about is in a foreign prison and you must wire money to get this person out. These are very convincing scams, because they tend to make you react emotionally and not think for a moment. It is vital, therefore, that you verify the story first. Try asking personal questions, contact the relevant local authorities, and speak to other members of your family to check the validity of the story.

With overpayment or fake check scams, someone will reply to an advertisement that you placed. They will then write you a check for more than you asked, and will then ask you to wire the excess back to them. As always, the check is fake and you will have to pay the bank, as well as being out of pocket for whatever you placed the advertisement for.

Rental listing scams happen when you see a property for rent at a very low price. You will be told that the landlord is on missionary work or otherwise out of the country and all you have to pay for are the first and the last month’s rent. In reality, however, there is no place for you to rent, but they have indeed left the country and your money has vanished. Always be suspicious of low rental rates and never wire money.

How to Report Money Wiring Scams

If you think you have been a victim of a money wiring scam, the first thing you have to do is speak to the company through which you wired the money and file a fraud complaint. The Western Union fraud hotline can be reached at 1-800-448-1492, while the one for MoneyGram is at 1-800-MONEYGRAM (1-800-666-3947). Ask them to reverse the transfer immediately. While they are unlikely to be able to do so, there has to be a record of you at least asking them. Next, lodge your complaint with the Federal Trade Commission online.

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Michael Bennett

About Michael Bennett

Michael Bennett is Editor-in-Chief of Consumer Protect.com. Since 1999, he's worked across a multitude of areas of consumer protection including defective products, environmental issues, identity theft, predatory lending and more. If you find his articles helpful please share them with your readers.