People send hundreds of billions of dollars in remittances every year. And sadly, because of this volume, certain scammers try to trick people through different money transfer scams.
Here at Remitly, we want to help you understand how these money transfer scams work and recognize the warning signs of potential fraud so you can keep your money safe.
11 Common Money Transfer Scams
As people become better at recognizing scams, such as phishing attempts, scammers are also improving their methods.
Since many scams might be complicated to resolve after they happen, the best way to stay in control is by learning to spot potential scams when you encounter them.
These are some of the most common scams in the industry.
1. Family emergency scams
In this type of scam, the victim is led to believe that they are sending funds to help a loved one or friend in an emergency situation.
Scammers exploit the victim’s natural worry for someone they care about. This can involve a car accident, being stranded at an airport, or avoiding arrest.
The scammer may place an urgent phone call, posing as a relative, friend, or loved one or as a figure of authority such as a law enforcement official or medical doctor.
To protect yourself:
- Verify the emergency by contacting the loved one or friend directly. If you are still in doubt, try contacting them through alternative ways, for example, their phone number instead of a social media account, and ask a friend or relative for a second opinion.
- Do not rush the transaction. Take time to verify the situation.
- Be suspicious of requests for secrecy or urgency.
- Be wary of unsolicited calls or messages from unknown individuals.
2. Sextortion scams
Sextortion is a type of extortion where a perpetrator threatens to expose sexually compromising information, such as sexually explicit private images or videos of the victim, unless the victim meets certain demands, usually money. Victims tend to be younger adults.
To protect yourself:
- Be cautious about who you connect with on social media and dating sites.
- Do not engage in explicit video chat or exchange sexually explicit images with strangers.
- Do not send money to someone who is threatening to expose intimate photos or videos.
3. Threats/Blackmail scams
Threats/blackmail scams involve scammers unlawfully obtaining money from a victim through coercion. The scammer threatens to harm the victim if they do not cooperate.
The scammer may relay personal information in the email or call to add intimidation. They may threaten physical harm, claim to know where you live or work, and threaten to hurt you or your loved ones unless you pay up.
Scammers may also threaten the victim with arrest or jail time if they do not comply with the demands.
To protect yourself:
- Do not comply with the scammer’s demands.
- Contact law enforcement immediately if you feel physically threatened or scared.
- Be wary of unsolicited calls or messages from unknown individuals.
- Be cautious about sharing personal information online or in response to unsolicited calls or messages.
4. Imposter scams
In an imposter scam, a scammer poses as an authoritative individual and requests money to sort out a false situation.
Scammers may also pose as representatives from a reputable business (business impersonators), or financial institutions and make false claims of fraudulent charges that need to be reviewed or refunded or as overpayments to steal from the victim.
They make false claims about fraudulent charges and bank transfers, refunds, shipment issues, or other bogus fees that will cause the victim to share personal and/or financial information.
To protect yourself:
- Be cautious about sharing personal information online or in response to unsolicited calls or messages.
- Verify the legitimacy of the representative or business.
- Do not share financial information over the phone or email.
- Do not trust unsolicited communication from unknown individuals or businesses.
5. Investment scams
Investment scams often sound “too good to be true” or offer “risk-free” investment opportunities. They pressure victims to invest immediately, sometimes indicating the opportunity is for a limited time.
The victim is often lured through social media apps or cold calls/email inquiries.
To protect yourself:
- Be cautious of investment opportunities that sound too good to be true or pressure you to invest immediately.
- Do your research and verify the legitimacy of the investment before investing any money.
- Do not invest money you cannot afford to lose.
6. Romance scams
In a romance scam, the victim is tricked into thinking they’ve found true love online. Scammers play with your emotions, pretending to be interested in a romantic relationship. They use flattering words and stolen pictures to win trust and affection.
Once they have the victim hooked, they ask for money or gift cards. They might claim it’s for a plane ticket to meet up or to cover unexpected medical expenses. They prey on the desire for love and companionship, making it hard to say no.
To protect yourself:
- Verify the person’s identity by doing a reverse image search or asking for a video call.
- Be suspicious of requests for secrecy or urgency, as scammers often use these tactics.
- Be cautious of unsolicited messages or calls from strangers professing love or interest.
7. Tech support scams
Tech support scams involve scammers posing as representatives from reputable companies like Microsoft or Apple and claiming that the victim’s computer requires tech services in order to gain access remotely and steal from the customer.
Typically, victims receive an unsolicited phone call, text message, or email from an individual claiming to represent a company’s “Tech Support,” “Help Desk,” “IT Department,” or a similar office.
To protect yourself:
- Remember that reputable companies will never contact you out of the blue and ask for access to your computer.
- Do not provide personal or financial information to unsolicited callers or email senders.
- Independently verify the legitimacy of any request for tech support services.
8. Immigration scams
If you receive a call from someone claiming to be an immigration official, it’s okay to feel suspicious immediately. Scammers may call you and claim there’s a problem with your immigration documents that you can solve by making an immediate money transfer or providing your account information.
They may even provide personal information or make threats of deportation, but you should never give out personal financial information to strangers.
To protect yourself:
- Visit the official website of your country’s immigration authority to verify how they communicate and accept payments. If you receive a suspicious message, contact the agency directly using the contact information listed on their official site.
- Be cautious of anyone asking for payment via money transfer, gift cards, or to a personal account, as these are common scam tactics.
Unfortunately, you may come across other scams as the methods change frequently. Learning to recognize general warning signs of the latest scams which can help you stay safe.
9. Prize scams
Prize money scams involve criminals trying to steal money with phony sweepstakes, lotteries, or contests. Usually, the scam begins with an unexpected email or phone call saying that you won a cash prize in another country.
The scammer might ask for your bank account information so that they can directly deposit the winnings and then use the information to conduct fraudulent activity with your bank account.
Another version of the scam works similarly to some other money and wire transfer scams. The fraudsters send a fake check to the victim and then tell the victim to wire money to them to cover fees like currency conversion or processing fees.
After you deposit the check and transfer or wire money, you find the check is fake. You may be subject to fees from your bank and lose the transferred or wired money.
To protect yourself:
- Research any unfamiliar contests or sweepstakes before transferring money.
- Never initiate money transfers until you’re certain checks have cleared.
- Call the issuing bank of any check received to verify funds and authenticity.
- Never give your bank account information to an unknown party.
10. Job scams
A job scam is when a fraudster advertises a fake job, such as a secret shopper position or work-from-home opportunity, through social media, fake websites, and even roadside signs.
When you express interest in the job, the scammer may put you through a fake interview process, asking you to answer questions and provide personal information.
Then, they’ll tell you that you’re hired but explain that you need to transfer money to cover processing fees to enroll you in their work-from-home program, to pay for necessary equipment, or to complete a mandatory training course. You only find out that the job was fake all along after the money’s been sent.
To protect yourself:
- Research the company independently. Check their official website and look for verified contact details. Be wary if the company has no website and only uses text or group chat for communication.
- Be cautious of any job that requires you to pay money upfront—whether for equipment, training, or application fees.
11. Marketplace scams
Marketplace schemes seek to take advantage of people buying and selling things through Facebook Marketplace, Craigslist, eBay, and other sites.
There are two versions of this scam.
With the first, a fake buyer asks if they can pay for an item via money order, personal check, or cashier’s check.If the seller says yes, the buyer sends a fake check or money order for more than the sale price. The buyer will then ask the seller to transfer the extra money back to them. After they go through with transferring money, the check turns out to be bad.
Fake sellers can also try to perpetrate this money transfer scam. With this version, a fraudster lists an appealing item for sale on a marketplace site. If you express interest, they will ask you to send money and tell you they will ship the item after receiving the funds.Once you transfer money to them, you won’t receive the item and they will say there was a problem or even just not respond.
To protect yourself:
- Opt to process transactions through sales platforms. Be wary of anyone who asks you to go outside the official channels to avoid fees.
- Check reviews and ratings for buyers and sellers.
Common signs of financial scams
Not sure whether something is a scam? Watch out for these red flags:
- They insist on handling everything by email, text, or social media messages.
- There are misspellings or serious grammar issues in communications.
- The return email address is strange or unrecognized.
- They put pressure on you to send money quickly.
- They ask you to send money to a foreign country even though they claim to be in your home country.
- You’re asked to use cashier’s checks, wire transfers, or other means outside of the usual or official process.
Staying safe from money transfer scams
Follow these steps to safeguard your money and your information:
- Never give out personal information on an unsolicited call or message.
- Don’t send money to someone you don’t know personally.
- Contact family members at known phone numbers if you receive an unfamiliar request from them and ask another family member for a second opinion.
- Regularly update your passwords.
- Install blockers for pop-ups and antivirus software.
- Do not share your login information for Remitly, online banking information, or login credentials for other financial apps.
If you send a transfer to a scammer, we might not be able to help, and you could lose your money.
Report money and wire transfer scams
If you’ve been targeted by a money transfer scam, even if you didn’t send any money, it’s important to report it. Contact your local police and your bank to file a report. Also contact Remitly or the transfer provider you used. Your report contributes to broader efforts to stop scams, potentially protecting others from being targeted. To learn how and where to report scams in your region, visit our Scam Recovery Guide, which includes steps you can take and support resources available globally.
Although criminals do try to exploit the money transfer system to their advantage, money transfers are still a convenient way to send money to your loved ones located abroad. By following the tips outlined in this article, you can do so safely and protect yourself from scammers.