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Protect Your Business From Money Mules

Protect Your Business From Money Mules

Fintech
Bureau Team
Bureau Team

November 1, 2022

Since time immemorial, mules have been used as a preferred mode of transport for goods. While their utility, over the years, has dwindled, the term is now used to refer to criminals who use humans to move stolen money across different accounts to cash out of fraudulent transactions. 

A money mule is someone who illegally transfers money on behalf of someone else. These accounts play a critical role in the fraud supply chain and the money laundering process. Syndicated crime rings usually pay mules a percentage of successfully transferred/laundered funds. Such funds are typically accrued via financial fraud or any other illicit activity.

Tracing Money Mule's Journey
Types of Mules
  • Willing participants: Such people are aware that they are facilitating criminal activity. They apply for financial products for the sole purpose of money laundering.
  • Duped participants: Fraudsters trick some people into participating in illegal money-moving activities. These mules believe that lawful money-moving business opportunities exist or someone needs money transferred for an emergency. 

Irrespective of the actual MO, it is challenging to identify money mules during onboarding. It involves a genuine account and legitimate actions from account holders. Hence, KYC checks are rendered futile.

How Money Mules Impact Your Business

Mule accounts can lead to a variety of adverse outcomes for financial organisations:

Money Mules And Their Impact

Identifying mules has become challenging, with the pandemic providing a solid impetus to digital banking. Crime rings have been employing the services of displaced workers while also abusing economic relief programs from a fraud perspective. All of this has led to steady growth in money mules’ activity since the beginning of the pandemic.

Tackling Money Mules with Bureau

Having the right checks in place enables businesses to combat money laundering and upgrade their anti-money laundering (AML) compliance efforts. Bureau’s end-to-end user onboarding and fraud prevention platform accurately and seamlessly verifies identities, reduces risk, and stops fraud while promoting compliance and growth, all in real-time. With the help of pre-integrated APIs that intelligently combine insights from hundreds of data sources, including device, identity, email, and biometrics, fraud detection becomes more manageable and accurate. Here's how Bureau tackles money mules.

Behavioural Biometrics

Bureau uses Behavioral Biometrics signals in innovative ways to detect mules at the time of onboarding. Solutions are centered around the following dimensions:

  1. Style of Application: How familiar is the user with the application process? Members of syndicated crime rings typically apply for many financial products. Additionally, they demonstrate a high familiarity with the application process compared to a legitimate user.
  2. Data familiarity:  A criminal using stolen identities to open accounts is unfamiliar with personal data. Hence, the person may display hesitation or rely on copy-and-paste techniques to enter information that would be intuitive to the legitimate user.
  3. Expert behaviour: Does the user display advanced computer skills compared to the general user? A criminal often demonstrates advanced computer skills rarely seen among the genuine user population. Common examples include advanced shortcuts, special keys, or application toggling.

Digital Footprint

Since criminals also use synthetic identities to open mule accounts, another way of detecting mules is to verify the legitimacy of the identity. Bureau can detect synthetic identities via

  1. Searching for a mismatch between the various components of PII information
  2. Assessing the depth of the digital presence of the identity across a plethora of platforms. 

Bot Detection

Since criminals attempt to launder vast sums of money, bots become handy tools to open multiple accounts automatically. Bureau can discern between digital traffic emanating from a bot and a human user.

What To Watch Out For

Stop Mulling Over Mules

With COVID-19 leading to widespread unemployment, it has now become easier for criminals to recruit money mules. As a result, now it’s harder to track such illegal money transfers involving individuals, especially those who have verified payment accounts. They are classified as low-risk and aren't closely monitored which increases the chance of fraudulent transactions going undetected. Detecting mule accounts is a complex process as criminals employ various methods to launder stolen funds. However, bespoke solutions can enable financial organisations to:

  1. Disrupt criminal strategies with the effect that syndicated crime rings will learn to steer away quickly.
  2. Protect unwitting money mules’ accounts from financial/legal impact.
  3. Work with law enforcement to return stolen funds to fraud victims rather than allowing criminal profiteering to persist.

To know more about our solutions, reach out to us

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