Cross-border fraud refers to any scam or fraud in which a criminal in one country uses deception to steal money or valuables from a victim in another country.
In the past, cross-border fraud was typically perpetrated through postal mail, phone, fax or ads in newspapers and magazines. Social media, email and the internet have made it possible for fraudsters to carry out their criminal schemes on a global scale, targeting millions of potential victims. One study estimates that the amount of money lost every year to fraud, already in the billions, will increase 52% by 2024.
Cross-border fraud takes many forms:
• Goods ordered and paid for but never received—You send money to someone in another country to pay for merchandise that never arrives. When you try to contact the person to resolve the problem, they have disappeared. Scammers often create fake websites to trick people into paying for nonexistent items or giving information about their credit cards and bank accounts. You may be asked to pay additional amounts for customs fees and shipping for an item that you never receive.
• Spoofing and phishing—You receive an official-looking email that appears to be from your bank or an online retailer, telling you that you have just purchased an item for several hundred dollars or that you need to update payment details for a recent purchase. The email includes a link to enter credit card details or the username and password for your e-commerce account. The information you enter will be used to steal from your account.
Investigating cross-border fraud is complicated because the criminal is in a different country from the victim.
Approximately 60% of the consumers who have never purchased something online from another country say that they are afraid of becoming victims of cross-border fraud. However, only a fraction of a percent of online shoppers has actually experienced cross-border fraud.
You can avoid becoming a victim by being vigilant:
• Use common sense. If a deal seems too good to be true, it probably is.
• Make sure you are buying from a secure website. The URL should have a padlock icon and “https:” in front of the URL.
• Resist the temptation to buy foreign lottery tickets, and ignore emails or letters that announce you have won a prize. Would a genuine lottery or sweepstakes notify winners by email?
• Do not respond to phone or email alerts claiming to be from your bank, an online retailer such as Amazon or a government agency such as the IRS. Log in and check your accounts online, or call the bank directly if you suspect there might be a problem.
• Pay with a credit card or a payment account system that offers fraud protection and other guarantees. Never wire money to another bank or pay with money orders or gift cards, unless you are absolutely sure whom you are dealing with. Once money has been wired to another bank and the recipient has withdrawn it, your chances of getting it back are very slim.
• If you are selling something, never accept a payment that is more than your asking price and send money back to the buyer, no matter how convincing their story is. E-commerce platforms such as Amazon, Etsy or eBay offer sellers many protections, as well as convenient payment systems and assistance with shipping. If a buyer attempts to negotiate with you by text or email outside of the e-commerce platform, drop the transaction.
• If someone contacts you on social media or by email, requesting help to move a large sum of money out of a foreign country, report them and then block them or delete the email. Report unsolicited email offers to [email protected]
• While most online retailers require you to pay for merchandise before they ship it, never pay advance fees to receive a prize or discount. Do not pay a retailer additional sums for unexpected customs duties. A legitimate retailer includes these in the price or arranges for you to pay such tariffs when you take delivery of the goods.
If you are a victim of cross-border fraud, report it immediately to local law enforcement and to your bank. By acting quickly, you might be able to recover some of your losses and preserve digital evidence for future legal action.
Ben Allen
