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How to Protect Yourself From Remote Deposit Fraud

posted on Wednesday, July 17, 2019 in Security & Fraud Information

Mobile banking has created new convenient ways for consumers to access their bank accounts, including the ability to deposit a check from a mobile device. Unfortunately, this tool has also been exploited as a way to commit fraud.

As banks become more and more sophisticated in how we serve our customers, fraudsters follow by attempting to take advantage of new tools and services banks provide. At Northwest Bank we take precautions to make sure our customers have a safe online banking experience, but to truly prevent this type of fraud from taking place, consumers need to know how to spot it before they become a victim.

Remote deposit scams can involve the fraudster gaining access to a victim’s bank accounts and depositing fraudulent checks into their accounts. They will then ask their victims to withdraw the funds and send it back to them often through a third-party money transfer service. It can also involve sending a fraudulent check to an unsuspecting victim.

Types of Remote Deposit Scams

According to a report by Guardian Analytics, a fraud detection service, the two most common types of remote deposit fraud are the sweetheart scam and fake payday lenders. Remote deposit fraud can also come through fake job postings, such as requests to become a mystery shopper.

  • Sweetheart Scam — Fraudsters often use web-based tools, such as online dating websites and social media networks, to create fake profiles and prey on victims. After fraudsters gain the trust of their victims, they will present an elaborate problem and ask victims to give them access to their bank accounts.
  • Fake Payday Lenders — Fraudsters will tell victims that before a loan can be approved, the victim must provide the fraudster with bank account information to which he or she can direct the deposits. They will request that the victim transfer the money back to them as a gesture of good faith to be approved for a future payday loan.
  • Fake Job Postings — Fraudsters will send phishing emails to potential victims, advertising fake jobs that could make them thousands of dollars per month, such as becoming a mystery shopper. Victims will receive a payment to their account with instructions to send part of that payment back to the company. The check is then returned as fraudulent, making victims financially responsible for the full amount of the check.

How to Protect Yourself

The key thing to remember with these scams is that if it sounds too good to be true, it probably is, especially if they involve requests for financial account or personal information. Following are a few tips to help protect yourself from becoming a victim:

  • Look at the source. If you are communicating with someone you’ve never met in person or a company you can’t find online, and they start asking for personal or bank account information, it’s most likely a scam. Always be suspicious.
  • Watch your bank accounts. Don’t wait for your monthly bank statements to check your accounts. The sooner you notice suspicious activity, the sooner something can be done to stop it. With mobile banking, it’s easy to check accounts at your convenience. Try to log in at least once a week.
  • Never divulge personal or bank account information. Keep your personal and bank account information private and don’t be rushed into handing over such information. A fraudster may make it sound like they are in an emergency situation and need you to take immediate action. This should be a big red flag and sign that you should cut off all communication with them.

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