WASHINGTON (10/30/09)--This week saw several government warnings and alerts about financial frauds as well as several credit unions reporting other scams that could spook some accountholders. But these are no Halloween pranksters. Keesler FCU reported that at its base in RAF Mildenhall, England, about 100 members saw fraudulent charges on their accounts this month (Stars and Stripes
Oct. 28). All affected accountholders had visited Spain sometime this year, Michelle Foster, a loss prevention manager for Keesler told Stars and Stripes
. The losses were from Visa debit cards. Visa said it is aware of a possible security issue in Spain but said the investigation was ongoing and it couldn't comment. Visa Europe contacted several affected banks and credit unions when the fraud was discovered. One Keesler member reported charges of $539.16 from boutiques in Chicago suburbs. She said the only time she used her debit card while in Spain was at a mom-and-pop store near the beach. Another credit union , Service CU, which has 15 locations in Germany and 17 in the U.S., saw less than one-half of 1% of members' cards compromised by the breach, the newspaper said. In another situation, the Federal Deposit Insurance Corp. (FDIC) Thursday issued an alert warning financial institutions of an increase in schemes to recruit individuals to receive and transmit unauthorized electronic funds transfers (EFTs) from deposit accounts to individuals overseas. The recruitees or "money mules" are solicited on the Internet by criminals who have gained unauthorized access to the online deposit account of a business or consumer. The criminal will originate an EFT from a victim's account to a money mule's deposit account. The money mule is told to quickly withdraw the funds and wire them overseas after deducting a "commission" of 8% to 10%. The schemes often occur in the context of online job posting websites, advance fee scams, mystery shopping jobs, and social networking sites. Some hesitant money mules have been threatened by their criminal "employers" if they don't make the transactions quickly and secretly, said the FDIC. The personal identifiable information provided by the money mule may be used later to commit identity theft or account takeover. FDIC cited several examples of events may indicate money mule account activity:
* A deposit account opened with a minimal deposit soon followed by large EFT deposits. * Deposit customers who suddenly begin receiving and sending EFTs related to new employment, investments, business opportunities or acquaintances (especially opportunities found on the Internet). * A newly opened deposit account with an unusual amount of activity, such as account inquiries, or a large dollar amount or high number of incoming EFTs. * An account that receives incoming EFTs and then shortly afterward originates outgoing wire transfers or cash withdrawals about 8%-10% less than the incoming EFTs; and * A foreign exchange student with a J-1 Visa and fraudulent passport opening a student account with a high volume of incoming/outgoing EFT activity.
Other frauds noted:
* Credit unions in Western Pennsylvania opened accounts for a man who deposits bad checks into the new account and withdraws the funds before they are returned as a "closed account." Sandy Shenk, PaCUSC state coordinator, has warned credit unions on the shared-branching network to establish procedures for allowing new members access to shared branching services. "This is a perfect example of why we suggest that credit unions require new members establish a relationship with them before allowing them to use other locations (Life is a Highway Oct. 29). * The FDIC issued a warning Tuesday about fraudulent e-mails appearing to be from the FDIC. The e-mails ask recipients to download and open a "personal FDIC insurance file" to check their deposit insurance coverage. The subject line includes the wording, "check your Bank Deposit Insurance Coverage." The message asks recipients to "visit the official FDIC website" by clicking on a hyperlink that appears to open forms. The hyperlink instead downloads an executable file that may try to obtain personal and confidential information, the FDIC said. * A debit/credit card scam has targeted shoppers at Hancock Fabrics in Stevens Point and Marshfield, Wis., and the account information has been used for unauthorized transactions at ATMs in the Milwaukee area (Stevens Point Journal Oct. 17). Police said the scam might be traced to old credit card readers at the fabrics stores.