Money Mules Become the Focus of Investigation

Criminal Law

Martin, Johnston & Socha

Wednesday, 29 November 2017

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A week of enforcement action against money muling has taken place across Europe, with the support of a number of international law enforcement bodies, including Europol.

The third coordinated global action against money muling, European Money Mule Action or ‘EMMA3’, involved law enforcement authorities from 26 countries.

Arrests Across Europe

Over the week, 159 individuals were arrested across Europe, 409 were interviewed by law enforcement authorities and 766 money mules were identified. EMMA3 has evolved from previous editions towards targeting not only the money mules, but also the money mule organisers. This resulted in 59 recruiters/organisers being identified.

Money mules are recruited by criminal organisations as money laundering intermediaries to receive and transfer illegally obtained funds between bank accounts and/or countries. This illicit money muling helps fund other forms of organised crime, such as drug dealing, human trafficking and online fraud.

Links to Cyber-Related Crimes

With the support of 257 banks and private-sector partners, 1 719 money mule transactions were reported, with total losses amounting to almost EUR 31 million. Among those money mule transactions, more than 90% were linked to cyber-related crimes, such as phishing, online auction fraud, Business Email Compromise and CEO fraud. For the first time, romance scams and holiday fraud (booking fraud) were reported by law enforcement authorities. Also, an increasing role of cryptocurrency (Bitcoin) transactions was identified in the money laundering schemes used by the criminals.

A joint statement from Europol, Eurojust and the European Banking Federation said:

“EMMA3 shows how a close public-private partnership between law enforcement, judicial authorities and the banking sector is essential to effectively tackle the illegal activity of money muling. We remain fully committed to working together in the fight against money laundering and other financial crimes and to further support joint initiatives like EMMA.”

Increase in Young Money Mules

In the UK, new research has revealed that people in the 18-24-age-group are increasingly at risk of becoming money mules by allowing their bank accounts to be used to transfer the proceeds of crime.

According to Cifas, which conducted the research, young people and students are particularly vulnerable as fraudsters know they are often short of cash. Criminals may approach them with what looks like a genuine job offer, asking them to receive money into their bank account and transfer it onto someone else, keeping some of the cash for themselves.

The figures show that there were 8,652 cases of ‘misuse of facility’ cases amongst 18 to 24-year-olds between January and the end of September this year. This represents 35% of all cases during that period.

The 2017 figures also demonstrate a dramatic rise in money mule fraud over the last five years, with cases involving 18-24-year-olds more than doubling since 2013.

“Money muling is money laundering and criminals are using young people as mules in increasing numbers,” explained Katy Worobec, Head of Fraud and Financial Crime Prevention, Cyber and Data Sharing, at UK Finance.”

“When you’re caught, your bank account will be closed, making it difficult to access cash and credit,” she added. “You could even face up to 14 years in jail. We’re urging people not to give their bank account details to anyone unless they know and trust them. If an offer of easy money sounds too good to be true, it probably is.”