AMID a rash of cybercrimes that have pushed lawmakers to rush passage of a measure giving regulators better weapons against those preying on victims amid the pandemic-induced migration to digital transactions, another major bank has sounded the alarm against a perceived rise in “money-muling schemes.”
The use of money mules—bank clients who allow criminals to use their accounts for moving funds from illegal sources—has become a vital cog in the rash of cybercrimes, a steep rise that has sent regulators setting off alarms in recent congressional hearings. In several hacking cases being handled by law enforcers, for example, the illegal “fruits” from the cyber theft were traced to legitimate bank account holders.
The latest warning against money mules was issued on Monday by Security Bank, urging the public to take extra precaution against getting involved in so-called “money muling schemes” in the country.
The bank reminded local banking clients that money muling is a crime in the Philippines and is punishable under the Anti-Money Laundering Act (AMLA) of 2001.
Money muling is classified as a type of money laundering activity, where people are lured to lend or sell their bank accounts to receive deposits or fund transfers from illegal sources. This makes the account holder a money mule, whether or not he or she is aware of the provenance of the monies.
Fraudsters offer commissions or entice unsuspecting account holders to sell their bank accounts.
Security Bank said these fraudsters usually carry out their recruiting activities through social media groups or by physically approaching people offering to buy their bank accounts for P1,000 to P5,000.
“This scheme allows ‘dirty money,’ or money obtained from criminal activity, to be moved around. Whether willingly or unknowingly, when an account holder lets their account be used by another person, they are risking the possibility of being a money mule and an accomplice to crime,” the bank said.
“Even if you know the third party asking for access to your account, do not lend your information. The appeal of cash commissions from becoming a money mule is not worth being involved in criminal activity. Keep your bank account details to yourself much like any other personal and confidential information,” the bank added.
Just last month, EastWest bank issued a similar statement.
“Many people don’t know what they’re getting into when someone asks them if they can make random bank transfers using their account. Nobody ever thinks that there is actually a crime associated with simply transferring money,” Joey A. Regala, Chief Information Security Officer at EastWest
EastWest said getting a small fee in exchange for a seemingly innocent fund transfer between two different accounts should already be a red flag. “Anyone can transfer money between two accounts easily nowadays, so having it go through a third party should already seem suspicious,” Regala said.
A series of money-muling transactions rocked several large banks in the ’90s, with the National Bureau of Investigation saying the funds moved around ranged from P40 million in one bank to over P100 million in another.