Electronic-wallet service provider GCash yesterday warned the public against online scams that use money mules to withdraw or transfer illegally obtained funds.
Money mules are verified account owners of a bank or other financial accounts used by a third party to obscure the source of the stolen funds and keep their identity a secret. These mules usually receive a commission or a fee for the use of their accounts.
To address the problem, GCash rejects or proactively bars accounts detected to be used for mule activity. It said it has blocked 780,000 accounts due to identity fraud including money mule issues since January this year.
GCash added it also works with law enforcement agencies to arrest fraudsters encouraging money mule activity. The most recent was an entrapment operation carried out through a collaboration of the Philippine National Police, Globe Telecom Inc. and GCash, which led to the arrest of a person selling over 500 GCash-registered SIM cards.
While money mules are often aware of their involvement in deceitful activities, others do not know they are already part of a criminal scheme, GCash said. Recently, a new form of money mule is surfacing where fraudsters go to impoverished areas and tell people they can earn money if they register to GCash using their phones.
“These individuals ignore all the warning signs that this is an illegal activity, but the worst thing is they no longer possess the actual accounts. The scammers can do anything they want with the accounts and not be liable for the consequences,” said Ingrid Berona, GCash chief risk officer.
As of end June this year, GCash had 66 million users and has breached the P3-trillion mark in gross transaction value (GTV). It expects to end the year with P6 trillion GTV.
