All About Money Mules

Information Provided By: U.S. Department of Justice, Federal Bureau of Investigation, Money LaunderingMoney laundering Money laundering is the illegal process of concealing the origins of money obtained illegally by passing it through a complex sequence of banking transfers or commercial transactions. Money laundering can be done through various mediums, leveraging a variety of payment vehicles, people and institutions., Forfeiture and Bank FraudFraud In law, fraud is intentional deception to secure unfair or unlawful gain (money or other assets), or to deprive a victim of a legal right. Fraud can violate civil law (e.g., a fraud victim may sue the fraud perpetrator to avoid the fraud or recover monetary compensation) or criminal law (e.g., a fraud perpetrator may be prosecuted and imprisoned by governmental authorities), or it may cause no loss of money, property, or legal right but still be an element of another civil or criminal wrong. The purpose of fraud may be monetary gain or other benefits, for example by obtaining a passport, travel document, or driver's license, or mortgage fraud, where the perpetrator may attempt to qualify for a mortgage by way of false statements. A fraud can also be a hoax, which is a distinct concept that involves deliberate deception without the intention of gain or of materially damaging or depriving a victim. Unit

What Is a Money Mule?

A money mule is someone who transfers illegally acquired money on behalf of or at the direction of another.  Criminals recruit mules to move money electronically through bank accounts, move physical currency, or assist the movement of money through a variety of other methods.  Once received, the muleMule A money mule sometimes called a "smurfer," is a person who transfers money acquired illegally (e.g., stolen) in person, through a courier service, or electronically, on behalf of others (usually criminals that they are knowingly or unknowingly affiliated). Typically, the mule is paid for services with a small part of the money transferred - but not always. Mules may or may not be aware that they are performing these actions. Money mules are often dupes recruited online for what they think is legitimate employment, not aware that the money they are transferring is the product of crime. The money is transferred from the mule's account to the scam operator, typically in another country. Similar techniques are used to transfer illegal merchandise. Mules can be prosecuted for numerous crimes. will wire the money into a third party bank account; “cash out” the money received, possibly via several cashier’s checks; convert the money into a virtual currency; convert the money into a prepaid debit card; send the money through a money service business; or conduct a combination of these actions.  Money mules are inherently dangerous, as they add layers to the money trail from a victim to a criminalCriminal A criminal is any person who through a decision or act engages in a crime. This can be complicated, as many people break laws unknowingly, however, in our context, it is a person who makes a decision to engage in unlawful acts or to place themselves with others who do this. A criminal always has the ability to decide not to break the law, or if they initially engage in crime to stop doing it, but instead continues. actor.

Money Mule Indicators

You may be a money mule if….

• You received an unsolicited email or contact over social media which promises easy money for little or no effort.
• The “employer” you communicate with uses web-based services such as (Gmail, Yahoo, Hotmail, Outlook, etc.).
•  You are asked to open a bank account in your own name, or in the name of a company you form, to receive and transfer money.
• As an employee, you are asked to receive funds in your bank account and then “process” or “transfer” funds via: wire transfer, ACH, mail, or money service business such as Western Union or MoneyGram.
• You are told to keep a portion of the money you transfer.
• Your duties have no specific job description.
• Your online companion, whom you have never met in person, asks you to receive money and then forward these funds to one or more individuals you do not know.

Where Are Money Mules Recruited?

• Online job websites
• Online dating websites
• Social networking websites
• Online classifieds
• Email Spam
• Darkweb Forums

Where Does The Money Come From?

Criminals obtain money through various illegal acts.  These criminals then need someone to move this money at their direction.

Common Criminal Activities Involving Money Mules:

• Internet-enabled Frauds:
  • Business Email Compromise
  • Online Job ScamScam A Scam is a confidence trick - a crime -  is an attempt to defraud a person or group after first gaining their trust through deception. Scams or confidence tricks exploit victims using their credulity, naïveté, compassion, vanity, irresponsibility, or greed and exploiting that. Researchers have defined confidence tricks as "a distinctive species of fraudulent conduct ... intending to further voluntary exchanges that are not mutually beneficial", as they "benefit con operators ('con men' - criminals) at the expense of their victims (the 'marks')". A scam is a crime even if no money was lost.
  • Work From Home Scam
  • Romance Scam
  • Mystery Shopper Scam
  • Advance Fee Scheme
  • Reshipping Scam
  • Grandparent ScamGrandparent Scam Grandparent/Family Emergency Scam - Scammers sometimes prey on grandparents by claiming their family members are in jail or in trouble and need money quickly. They use stolen personal information such as family member names and hometowns to seem more convincing.
  • Lottery ScamLottery Scam These scams involve someone claiming you won a prize. However, they say you must pay a fee or provide sensitive banking information in order to get it. They keep the money, and you get nothing for it.
  • IRSIRS The Internal Revenue Service (IRS) is the revenue & tax service of the United States federal government responsible for collecting taxes and administering the Internal Revenue Code (the main body of federal statutory tax law.) It is part of the Department of the Treasury and led by the Commissioner of Internal Revenue, who is appointed to a five-year term by the President of the United States. The duties of the IRS include providing tax assistance to taxpayers; pursuing and resolving instances of erroneous or fraudulent tax filings; and overseeing various benefits programs. Visit www.IRS.gov to learn more. or Law Enforcement ImpersonationImpersonation An impersonator is someone who imitates or copies the behavior or actions of another. There are many reasons for impersonating someone, such as: part of a criminal act such as identity theft, online impersonation scam, or other fraud. This is usually where the criminal is trying to assume the identity of another, in order to commit fraud, such as accessing confidential information or to gain property not belonging to them. Also known as social engineering and impostors. Scam
  • Technical Support Scam
  • Credit Card FraudCard Fraud Card Fraud is one of the most commonly referenced fraud definitions. It occurs when a fraudster uses a card (debit or credit) to make a purchase without the authorization of the cardholder. Card fraud can occur in-person or through digital channels.
• Drug Trafficking
• Human Trafficking

More details about the above-mentioned scamsScams A Scam is a confidence trick - a crime -  is an attempt to defraud a person or group after first gaining their trust through deception. Scams or confidence tricks exploit victims using their credulity, naïveté, compassion, vanity, irresponsibility, or greed and exploiting that. Researchers have defined confidence tricks as "a distinctive species of fraudulent conduct ... intending to further voluntary exchanges that are not mutually beneficial", as they "benefit con operators ('con men' - criminals) at the expense of their victims (the 'marks')". A scam is a crime even if no money was lost.  can be found on our website or www.FBI.gov

Money Mules Are Vital To Criminals

What To Do If You are a Money Mule…

1. STOP communication with any suspected criminals
2. STOP transferring money or any other items of value
3. MAINTAIN any receipts, contact information and relevant communications (emails, chats, text messages)
4. NOTIFY Law Enforcement immediately

Read our 5 Steps for Money Mules here

Who is at Risk?

1. College students
2. Those new to the country
3. Small business owners
4. Elderly individuals
5. Recent retirees
6. Those looking for a job
7. Those looking for a relationship
8. Those with memory loss
9. Anyone… Anywhere… Anytime!

How To Protect Yourself

• A legitimate company will not ask to use your own bank account to transfer their money. Do not accept any job offers asking you to do this.
• Be wary when an employer asks you to form a company in order to open up a new bank account.
• Never give your financial details to someone you do not know and trust, especially if you met them online.
• Be wary when job advertisements are poorly written with grammatical errors and spelling mistakes.
• Be suspicious when the boyfriend/girlfriend you met on a dating website wants to use your bank account for receiving and forwarding money.
• Conduct online searches to verify and corroborate any questionable information provided to you.
• Ask the employer, “Can you send a copy of the license/permit to conduct business in my county & state?”

Role In The Money Laundering Cycle

Placement

The movement of funds to a money mule, often by wire transfer deposit into the money mule’s bank account

• • In this phase, a victim or a criminal provides money to the money mule to move, based on the criminal’s instruction.
  • Some money mules never touch a computer.

Layering

Money is moved from the initial money mule account to other money mule accounts or other criminals involved in the scheme.

• • In this phase, funds are moved among money mules and criminals and possibly split into multiple transactions or converted into additional forms of value. These might include:
    • wire transfers
    • cashier’s checks
    • virtual currency
    • or physical cash.

Integration

The movement of laundered money back into the financial system.

Why Do Criminals Use Money Mules?

Money mules are used to facilitate the movement of criminal proceeds – whether from a fraud, such as a Business Email Compromise or other crime – the mules are the commonality.

The money moved by money mules belongs to the victims – it does not belong to the criminals, nor the banks, nor the money mules.

The role of a Money Mule is often very straightforward – with very little “cyber” expertise required.

1. Speed – Criminals believe they can direct the movement of victim funds through money mules, faster than law enforcement can keep track.  This is not always true.
2. Low Cost – If the money mule takes a percentage of money, this is victim money which never actually belonged to the criminal.
3. Low Risk – Each money mule adds one more level of distance between the victim and criminal actors.
4. Evolution of Crime – Criminals adapt their behaviors as necessary, based on the evolution of law enforcement and financial sector practices.

Classification Of Money Mules – The Money Mule Complicity Spectrum

Unwitting or Unknowing: Individuals unaware they are part of a larger criminal scheme

• Often solicited via an online romance scheme or online job scheme.
• Asked to use their established personal bank account or open a new account in their true name to receive money from someone they have never met in person.
• May be told to keep a portion of the money they transferred.
• Motivation: Trust in the actual existence of their romance or job position.

Witting: Individuals who choose to ignore obvious red flags or act willfully blind to their money movement activity

• They may have been warned by bank employees they were involved with fraudulent activity.
• They open accounts with multiple banks in their true name.
• They may have been unwitting at first but continue communication and participation.
• Motivation: Financial gain or an unwillingness to acknowledge their role (denialDenial Denial is a refusal or unwillingness to accept something or to accept reality. Refusal to admit the truth or reality of something, refusal to acknowledge something unpleasant; And as a term of Psychology: denial is a defense mechanism in which confrontation with a personal problem or with reality is avoided by denying the existence of the problem or reality.).

Complicit: Individuals aware of their role as a money mule and complicit in the larger criminal schemes

• Serially open bank accounts to receive money from a variety of individuals/businesses for criminal reasons.
• Advertise their services as a money mule, to include what actions they offer and at what prices.  This may also include a review and/or rating by other criminal actors on the money mule’s speed and reliability.
• Travel, as directed, to different countries to open financial accounts or register companies.
• Operate funnel accounts to receive fraud proceeds from multiple lower-level money mules.
• Recruit other money mules.
• Motivation: Financial gain or loyalty to a known criminal group.

Potential Consequences for Money Mules

Money mules help criminals launder their proceeds derived from criminal activities, by adding layers of recipients to the money trail.  These layers complicate and negatively impact the FBIFBI FBI - Federal Bureau of Investigation The Federal Bureau of Investigation (FBI) is the domestic intelligence and security service of the United States and its principal federal law enforcement agency. Operating under the jurisdiction of the United States Department of Justice, the FBI is also a member of the U.S. Intelligence Community and reports to both the Attorney General and the Director of National Intelligence. A leading U.S. counter-terrorism, counterintelligence, and criminal investigative organization, the FBI has jurisdiction over violations of more than 200 categories of federal crimes, including financial fraud.’s ability to accurately trace the money from a specific victim to a criminal actor.

If you are a money mule you could be charged as part of the criminal money laundering conspiracy and potentially face the following consequences:

• Prosecution and incarceration: Money mules may be prosecuted by law enforcement for participating in criminal activities and sentenced to jail time.
• Compromised personal identifiable information: Money mules’ own personally identifiable information may be stolen by the very criminals they are working for and used for other criminal activities.
• Personal liability: Money mules may be held personally liable for repaying the money lost by victims.
• Negative impact on credit: Money mule activities may result in negative credit ratings.
• Permanent inability to open bank accounts: Money mule activities may result in banks refusing to open bank accounts in the future.

U.S. Federal Violations And Penalties

The following applies to money mules in the United States, but Europe and other countries have similar laws.

Possible U.S. Criminal Charges:

• Mail Fraud | 18 USC § 1341
  Maximum 20 years imprisonment and/or $250,000 Fine.  If a financial institution is affected – maximum $1M fine or 30 years imprisonment or both
• Wire Fraud | 18 USC § 1343
  Maximum 20 years imprisonment.  If a financial institution is affected – maximum $1 M fine or 30 years imprisonment or both
• Bank Fraud | 18 USC § 1344
  Maximum $1M fine or 30 years imprisonment or both
• Money Laundering | 18 USC § 1956
  Maximum $500,000 or maximum 20 years imprisonment or both
• Transactional Money Laundering | 18 USC § 1957
  Maximum $250,000 or maximum 10 years imprisonment or both
• Prohibition of Unlicensed Money Transmitting Businesses | 18 USC § 1960
  Maximum 5 years imprisonment
• Aggravated Identity TheftIdentity Theft Identity theft is when someone uses another person's personal identifying information, without their permission, to commit fraud or other crimes. In both the U.K. and the United States it is the theft of personally identifiable information. Identity theft deliberately uses someone else's identity as a method to gain financial advantages or obtain credit and other benefits, and perhaps to cause other person's loss. The person whose identity has been stolen may suffer adverse consequences, especially if they are falsely held responsible for the perpetrator's actions. Personally identifiable information generally includes a person's name, date of birth, social security number, driver's license number, bank account or credit card numbers, PINs, electronic signatures, fingerprints, passwords, or any other information that can be used to access a person's financial resources. | 18 USC § 1028A
  Imprisonment of 2 years, in addition to other punishments