Drops, also known as money mules. How to avoid becoming an accomplice

Easy money offers online may be tempting but usually they are used to cover up fraud schemes. One of the most dangerous schemes is becoming a drop.

Who are these people and why an unknowing participation in such schemes can ruin your financial future and result in criminal charges?

Who is a drop?

Drop (also known as a money mule) — a person who agrees to become an intermediary in a criminal scheme for a monetary reward. This person, knowingly or not, helps fraudsters to commit money laundering of funds obtained through illegal means.

How does it work in practice?

Fraudsters request the drop to:

• Open a bank account and a card in your own name and give them full access to it (card number, card validity period, CVV, login and password to online banking).
• Carry out the instructions instead of giving them full access: transfer the received money to other accounts or cash them out in the ATMs and pass them to third parties. In exchange they promise a percentage of the amount.

In both cases the person becomes a link in the criminal chain.  

Why do fraudsters need other people’s cards?

Fraudsters’ main objective is to cover their tracks. Money transferred through a drop’s accounts is usually obtained through:

• Online fraud (phishing, online casinos);
• Drug, weapon and human trafficking;
• Financing terrorism and other illegal activity.

Criminals are trying to throw the police off their scent by using accounts of a group of people who don’t know each other for transactions. Though when authorities begin the investigation, the first people of interest are the holders of the account, the drops.

How the drops are recruited: offers that should be declined

Fraudsters use the cover of “employers” and search for potential victims on social media, messengers and recruiting websites. In their announcements they promise “fast and easy money without any experience”.

Most vulnerable groups are:

• Young people and students who are searching for a part time job;
• People in a tough financial situation, retirees, internally displaced people (IDP).

These categories could potentially agree to the offer without realizing the risks due to a lack of experience or financial vulnerability.

Possible consequences for becoming a drop

Participation in the drop scheme is not a regular “help”, it’s a complicity in a crime. Ignorance of the law or the fact that you were “lied to” does not exempt one from the consequences.

• Criminal liability. Your actions can be qualified under the articles of the Criminal Code of Ukraine providing for liability for money laundering or fraud. Consequences range from huge fines to imprisonment.
• Freezing the accounts and stained reputation. The bank freezes your accounts and blacklists you. In the future you may be refused service of opening the accounts, issuance of loans, and other financial services in any bank.
• Debts and financial losses. Fraudsters often can use not only your credit card but also your name to take out loans.

How to protect yourself: 3 financial hygiene rules

• Never transfer your credit card, PIN-code, login and password to your online banking to third parties. These are your personal keys to finances.
• Never agree to strangers’ requests to transfer money through your account or to withdraw cash for them.
• Ignore the offers related to easy money that require usage of your bank account.

What actions to take if you already became a drop?

If you have realized that you got involved in a criminal scheme, you should act immediately:

• Cut any contact with fraudsters. Block their numbers and accounts. Do not fall for their threats or persuasions.
• Block the card and account. Call the bank’s Contact Center or do it yourself in the app. Explain the situation to the operator.
• Contact the police. File a police report and describe in detail how you became involved in the scheme. This is your only chance to prove that you acted without any criminal intent and became a fraud victim yourself.

Keep in mind: there is no such thing as easy money. An offer to make a cash grab by giving access to your credit card is a trap that leads to criminal liability, stained reputation and financial losses.

Your financial security is your responsibility. Be vigilant and never trust third parties with your accounts.