My Phony Valentine: Covid Fuels Scams Romance

About 32,800 romantic scams were reported last year, up nearly 31 percent from 2019, according to Federal Trade Commission data released last week. Consumers reported losing $ 304 million in scams, up nearly 51 percent, the FTC said.

Romantic scammers often build fake people online to develop relationships with victims through online dating apps or social networking platforms. However, he keeps his distance, apologizing for not being able to meet in person. Sometimes it’s a fake military deployment, other times it’s a distribution on an offshore oil platform, said Monica Vaca, associate director at the FTC. As a virtual relationship strengthens, scammers make money requests, often disappearing once the money is in hand.

The current conditions are ripe for such frauds, said Ms. Vaca. Social distancing complicated the meetings in person. People spend more time online. There is a general increase in the use of dating applications. And the pandemic has increased the perceived credibility of money requests – for, say, medical bills or car repairs to reach a vaccination program.

Travel restrictions and health reasons also provide fraudsters with seemingly legitimate excuses to avoid meeting victims. “We see in our reports people saying things like, ‘Oh, I can’t meet; I just got my Covid diagnosis, “said Ms. Vaca.” So this becomes part of the story line. “

Consumers need to be vigilant, she said, but so must companies that are required by anti-money laundering rules to report suspicious activity. “They play a very important role in this,” said Ms Vaca.

Preventing fish transactions has become easier in recent years as financial institutions and money transfer companies have strengthened their data analysis tools. As fraudsters change tactics, companies can adjust systems to adapt to new patterns, allowing faster detection of suspicious activity or dubious customers.

In part, this is how Western Union Co.

managed to stay abreast of the evolving tactics of fraudsters, said Tyler Hand, compliance director of the money transfer company. Improvements to the company’s Denver monitoring technology in recent years have led to a decline in the number of romantic scams reported to the company, including in the last calendar year, he said. Some of these changes were made as part of an agreement with federal authorities, including the FTC, regarding alleged failures by police customers who could be engaged in fraud.

One thing that cannot be solved by an algorithm: human belief in the face of a possible romance. That’s why Western Union and competitor MoneyGram International Inc. say that customer access and education are also essential.

MoneyGram has partially strengthened its monitoring due to allegations by the FTC that the Dallas company failed to take action to counter fraudulent money transfers, which the company resolved in 2018. In addition to improved technology, MoneyGram also has a process to discuss with customers identified as potential victims of fraud, which has helped reduce romantic scams using the company’s services, according to Andy Villareal, head of MoneyGram compliance.

If a requested money transfer is reported as suspicious, MoneyGram may ask if the sender actually met the recipient before completing the transfer. The company could also tell the customer that he or she could be the victim of fraud, he said.

Such calls are often greeted with refusal; people do not want to believe that they were deceived because they made a connection with the recipient, said Mr. Villareal.

“The reality is that fraudsters are very good at identifying the types of psychological issues they can connect with their victims,” ​​he said. “They exploit them and become very good at it.”

Write to Jack Hagel at [email protected]