Money Mule: “In the world of mules there are no rules” – Ogden Nash (poet) 1902-1971

Posted February 7, 2017

Money Mule: “In the world of mules there are no rules” – Ogden Nash (poet) 1902-1971

Why be a Money Mule?

With the pressures of economic financial difficulty and the ramifications of holiday spending looming, there is higher temptation for banking consumers to misuse their banking facilities.

Enter the money mule recruiter, who offers seemingly high wages in return for a little work on the side. You can earn $3000-$4000 per week working from home or just by using your mobile phone!

As per the job description, the money mule’s job is simply to set up bank accounts and then exit stolen funds, keeping a percentage for themselves. Without the money mule, there will be very little online banking fraud. (For clarity I am not including CNP or First Party Fraud).

Anatomy of a Money Mule

Traditionally money mules are male, under 30 years old, and can often be found in certain pockets of the country. In mainland Europe, for example, they tend to cluster near border towns; in the UK they tend to live in East London or along the M1 motorway which connects London to Leeds. The money mule account behavior is different to a regular customer, as normal transactions for shopping and direct debits to pay bills are typically absent.

However, this traditional profile appears to be evolving, with even the older generation being tempted to make a quick buck.

CIFAS, the UK fraud prevention service, stated that in the first nine months of 2016 the number of cases among older banking customers is increasing fastest, with almost 1,600 new cases among 31-50 year olds compared with under 1,000 for the under 30s.[1]

How to Stop Money Mules – Law Enforcement

Money mules are receiving increasing attention this year. In February 2016 law enforcement agencies and judicial bodies from Belgium, Denmark, Greece, Netherlands, United Kingdom, Romania, Spain and Portugal joined to create the first coordinated European action against money muling. As a result, nearly 700 money mules were identified across Europe and 81 individuals were arrested after 198 suspects were interviewed by law enforcement agencies.  With the support of over 70 banks, significant financial losses were discovered and prevented, and over 900 victims of this crime were identified. More than 90% of the reported money mule transactions were linked to cybercrime.[2] By November 2016, there are 178 money mule arrests due to this task-force.[3]

In the US, the FBI has conducted similar operations. In 2010, 37 Eastern European money mules were arrested as part of operation Trident Beach – a scam utilizing Zeus Trojan malware. This case identified attempted thefts of $220 million, with an actual documented U.S. loss of $70 million.[4]

How to Stop Money Mules – The Banks

The banks themselves have been late tackling the issue in a coordinated way. The fundamental issue is one of self-interest: what is the benefit for a bank to tackle money mules when often the loss sits with another organization; the victim’s bank? The way to tackle this issue is to internally clean the book of money mules, utilizing models to identify mule profiles and behaviors. The more holistic method is to leverage information sharing between banks, for example through the ThreatMetrix Digital Identity Network, to flag these accounts between organizations – stopping the fraud at the payment point. This can be completed by highlighting whether the beneficiary is risky or flagged previously as a mule by another bank.

If you can stop mule fraud you stop the majority online banking fraud – it’s simple…

 

[1] https://www.cifas.org.uk/press_centre/money_mules

[2] https://www.europol.europa.eu/newsroom/news/europe-wide-action-targets-money-mule-schemes

[3] http://www.eurojust.europa.eu/press/PressReleases/Pages/2016/2016-11-22.aspx

[4] https://www2.fbi.gov/pressrel/speeches/snow100110.htm

Alisdair Faulkner

Alisdair Faulkner

Chief Products Officer, ThreatMetrix

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