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Bank Transfer Scams

Renata Pacheco

Written by

Renata Pacheco

June 26, 2023

In the digital era, where convenience is synonymous with online banking, the spectre of bank transfer fraud has unfortunately been an unwelcome companion.

Over the past few years, this form of cybercrime has seen an exponential rise, making understanding money transfer scams a crucial necessity for every individual with a bank account.

Bank transfer scams have risen sharply over the past few years, evolving in complexity and audacity. Part of the surge can be attributed to the increasing shift toward online banking, providing a fertile playground for fraudsters.

But make no mistake; while technology has facilitated these scams, it is human vulnerability and lack of awareness that these swindlers exploit most. The monetary losses inflicted by these scams run into millions, making them a severe concern for customers and banks alike.

The nature of bank transfer scams

The core of bank transfer fraud lies in its deception. The scammer poses as a trustworthy entity – a bank official, an executive from a well-known company or even a distressed family member.

Their objective is simple: to deceive you into transferring money from your bank account to theirs under false pretences.

This scam can manifest in several forms, from phishing emails asking for your bank details to fake calls demanding immediate payment to avert a crisis. With such a diverse range of tactics, staying vigilant and informed is the best defence against becoming a victim of a bank transfer scam.

People with masks in front of computers

Types of bank transfer scams: Methods used by fraudsters

Fraudsters utilise various tactics to deceive unsuspecting victims to send money. Let’s delve into the most common types of bank transfer scams:


Phishing remains a prevalent method amongst fraudsters, often exploiting unsuspecting victims through seemingly innocent email communications. They skillfully impersonate legitimate organisations, convincingly mimicking logos, language, and even sender email addresses.

But these carefully constructed emails carry a sinister motive: to trick victims into voluntarily revealing their sensitive bank account details. In more complex cases, these emails contain malicious links to fraudulent websites designed to capture and exploit the victims’ data.

Fake president fraud

This elaborate scam sees fraudsters impersonating top-ranking executives or authority figures within organisations. The scam thrives on creating a sense of urgency and confidentiality, pressuring employees into making immediate money transfers.

Typically, the communication cites a critical business deal, or a time-sensitive opportunity, which requires absolute discretion and swift financial action.

App scam

The digital banking era has introduced new opportunities for fraudsters, notably app scams. They craft deceptive banking applications, mirroring the interface of legitimate ones to fool victims into entering their bank account details.

These apps often offer enticing features or exclusive benefits to attract users and manipulate them into executing the scam.

Social media scams

With their extensive reach and perceived authenticity, social media platforms are an attractive playground for scammers.

They create fake profiles, foster relationships with unsuspecting victims, and coerce them to transfer money. Often, they fabricate emergencies or feign financial distress to justify the request for funds.

📚Related: How Fraudsters Exploit Social Engineering Tactics

Lottery and sweepstakes scams

In this type of scam, fraudsters may use tantalising bait—usually a giant lottery or sweepstakes win—to lure victims. The catch? Victims must first pay a fee, or alleged taxes, to claim their “winnings”.

The allure of a life-changing fortune is often sufficient to suspend the victims’ disbelief, enabling the scam to succeed.

Charity scams

Fraudsters exploit compassion and generosity by impersonating charitable organisations. These scams intensify during global crises or natural disasters when empathetic donors are likely to contribute.

Unbeknownst to the victims, their donations end up in the fraudsters’ pockets, not towards the intended cause.

Stranded traveller scams

This scam sees fraudsters feigning distress, often posing as a stranded friend or relative in desperate need of financial aid.

The cover stories vary, but common themes include lost wallets, missed flights, or unexpected medical bills. The emotional manipulation and sense of urgency can often compel victims into sending money.

Online dating scams

Romance is at the heart of this scam. Fraudsters create convincing profiles on dating platforms, build emotional connections with victims, and eventually request financial assistance.

The reasons for needing money are typically coated with a veneer of emergency or personal crisis, designed to elicit sympathy and override scepticism.

Understanding these methods can help individuals recognize and prevent falling victim to these devious schemes.

 A person in a hoody

Recognising a bank transfer scam: Common features

Recognising a bank transfer fraud involves spotting various red flags in the perpetrator’s approach. Fraudsters can be incredibly sophisticated, employing manipulative tactics to coerce victims into revealing their bank details or transferring money.

Signs of scam communication

Scammers often use specific communication techniques that can serve as warning signs.

For instance, using social media messages or unrecognised email addresses, which lack the professional language typically associated with legitimate organisations, is common.

They may urge quick action, capitalising on the victim’s fear of losing money, facing legal consequences, or missing out on an ‘opportunity’.

Often, these requests for immediate bank transfer come with a fabricated story to make it seem urgent, such as dealing with issues related to money laundering or identity theft. They might also dissuade you from discussing this ‘urgent matter’ with others or contacting your bank’s fraud team.

Impersonation of trusted organisations

Impersonation of trusted organisations is a primary tactic in many transfer scams. Cybercriminals might pretend to be calling from your bank or another company you’re familiar with, using deceptive techniques to gain your trust.

Watch out for requests for confidential information that a legitimate representative would never request, such as your full password or card details.

The fraudster impersonating an institution’s representative may also urge you to act quickly, creating a false sense of urgency to prevent you from verifying their identity.

How banks are combating transfer scams

In the face of escalating bank transfer fraud, banks and card providers employ several countermeasures to protect their customers. This includes adopting new regulations and technologies that help ensure the safety of their users’ bank accounts and payment details.

Adoption of the voluntary code

Recently, many banks have adopted the Voluntary Code, a commitment to protect customers from authorised push payment (APP) scams.

If a bank detects a suspicious transaction, such as a transferred amount to a dubious account, the bank can halt the transaction, safeguarding the customer’s money.

This code also ensures that victims are promptly reimbursed if they’ve fallen victim to a scam, provided they’ve taken necessary precautions to avoid fraud. Further, customers are encouraged to contact the Financial Ombudsman Service if their concerns aren’t addressed adequately.

Introduction of confirmation of payee checks

Another significant step towards combating bank transfer scams is introducing Confirmation of Payee (CoP) checks. This measure makes it mandatory for banks to verify the recipient’s name before any significant amount of money is transferred, providing an additional security layer.

Additionally, banks are becoming increasingly vigilant about sharing the CRM code – a unique reference number generated for every complaint about bank transfer fraud, helping the Ombudsman Service and banks track and deal with complaints more efficiently. These measures collectively contribute to a safer banking environment.

Steps to take when confronted with a possible bank transfer scam

Bank transfer scams can be pretty deceptive, but knowing the proper steps when confronted with a scam can make all the difference.

Reporting to the bank’s fraud team

When you suspect you’ve fallen victim to a bank transfer fraud, you should immediately stop to transfer money and contact your bank immediately. The bank’s fraud team is trained to handle such situations and can provide immediate guidance on securing your account.

They might temporarily block your bank account or even change your account number to prevent further fraud. If you’ve transferred money to a fraudster’s account, your bank can liaise with the recipient’s bank to recover the funds, provided the funds haven’t been moved out.

Seeking aid from the financial Ombudsman Service

If your bank refused to help or you’re dissatisfied with their response, you can escalate your complaint to the Ombudsman Service.

They provide free, independent service for resolving disputes between customers and financial businesses. Furthermore, if you’ve been a victim of a money transfer scam, you should report the incident to Action Fraud, the UK’s national reporting center for fraud and cybercrime.

In conclusion, bank transfer scams significantly threaten our financial security. Understanding how these scams work, their standard features, and the steps to take when confronted with one, can be instrumental in safeguarding our finances.

As technology evolves, fraudsters become increasingly sophisticated, but we can counteract their malicious efforts with awareness, due diligence, and prompt action.

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