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Mobile Deposit Fraud

Posted on Monday, April 11, 2022 in Articles

How to Protect Yourself from Mobile Deposit Fraud

Mobile banking has created a convenient way for consumers to access their bank accounts, including the ability to deposit a check from a mobile device. Unfortunately, this tool has also been exploited as a way to commit fraud.

At First National Bank, we take every precaution necessary to make sure our customers have a safe online banking experience and know how to spot fraud before they become a victim.

Mobile Deposit Scams

Mobile/remote deposit scams or fake check scams, involve fraudsters depositing fake checks into victims’ bank accounts to gain access to their money. Once these deposits are made, victims are asked to withdraw the funds and return them, usually through a third-party money transfer account.

When carrying out these mobile deposit scams, cybercriminals typically make up intricate stories explaining why they cannot access the money themselves, which often makes their stories seem more legitimate.

Last year, 72 percent of mobile banking scams involved remote deposit captures and fake checks. According to the Federal Trade Commission, more than 27,000 fake check scams were reported, with losses reaching around $28 million. Mobile deposit scams often target the elderly and young adults, especially people in their twenties. Of these scams, 51% claim to be lucrative job or career opportunities, 18% are carried out using online selling scams, and 4% claim to be grants or rewards. 

Common Types of Mobile Deposit Scams

There are many different types of mobile deposit scams, but three of the most common are romance scams, fake check scams, and online loan scams.  

Romance Scams

Online datingThese dating app or romance scams are simple - cybercriminals create fake profiles on dating sites or apps such as Hinge, Tinder® or Craigslist. They start conversations with their targets, building trust and rapport over weeks or months. Once a “relationship” has been established, they claim to need money for a medical emergency, funeral expenses or hospital bill. 

These fraudsters will often ask victims to send them funds using wire transfers or set up a new bank account. The stolen money is then deposited into the new account prior to the wire transfer.

These scammers often say they’re located out of the country and may immediately ask victims to move communication off the dating app to personal email or text messages. 

Romance scams can be devastating for several reasons. Not only can they deplete a victim’s life savings or hard-earned cash, but they can also violate one’s trust through the simulation of a real romantic relationship. 

Fake Check Scams

With more jobs becoming remote in the past few years, work-from-home scams are on the rise. These scams often target people in their 20s and 30s, especially those looking for remote positions with flexible hours. These mobile deposit scams attract job seekers with advertisements for nondescript jobs that don’t exist, such as mystery shoppers or vague marketing positions. After a person applies, they’re asked to divulge their banking information so that they can receive an online deposit to cover job-related expenses. Once the scammer has the information they need, they leave their victims with a bank account in the negative. 

Online Loan Scams

Fraudulent online loan scams are similar to job scams. Advertisement for loans that are not legitimate can lead to a victim providing personal and account information, which gives the scammer access to the victim’s account.

How to Protect Yourself

Although it's easy to feel helpless against banking scams, there are many ways to protect yourself. Here are some tips that will help keep your financial data safe: 

Scam protectionBe extremely wary of emails that sound too good to be true, especially if you’re asked to hand over personal information or data.

Stay on the outlook for these scam activities:

  • Perpetrator asks victim to return funds via wire transfer or gift cards
  • Victim is asked to keep relationship or online interactions private 
  • Fraudsters send unexpected requests or emails asking for money
  • Victims are asked for login information to online banking accounts

These are ways to protect yourself. 

  • Verify the source. If an email or text message asks for personal information, make sure the instructions are legitimate by contacting the source directly. If you are communicating with someone you’ve never met in person or a company you can’t find online, and they start asking for personal or bank account information, it’s most likely a scam. Always be suspicious.
  • Monitor your bank accounts. Don’t wait for your monthly bank statements to check your accounts. The sooner you notice suspicious activity, the sooner something can be done to stop it. With online and mobile banking, it’s easy to check accounts at your convenience. Try to log in at least once per week.
  • Don’t give your personal information to anyone. If you receive a call from your bank asking to verify your information, say you’ll call them back and use the phone number listed on your debit card. 
  • Safeguard social media accounts. Cybercriminals use social media to glean information about their victims, such as where they bank or shop. Refrain from oversharing this information. 

Avoiding financial scams and protecting your checking or savings accounts may seem like daunting tasks, but remaining vigilant and learning how to spot mobile deposit scams can keep you safe.

  1. account security
  2. fraud
  3. fraud prevention
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