Is There Fraud In The Money Transfer Industry?

Is there fraud in the money transfer (remittances) industry? Of-course there is. Where there is money, there is fraud. Recent developments in identity technology, two-factor authentication and device fingerprinting technology (to name a few) have resulted in a system that presents a very difficult environment to commit fraud.

Watch this short video to learn about fraud in the money transfer industry.


Hello. Have you ever wondered if there is fraud in the money transfer services industry? My name is Faisal Khan. I’m a banking and a payment consultant and this is what I’m here to answer today. The answer is yes.

Fraud is everywhere, almost in every industry. It’s prevalent from the online industry, the e-commerce, the money transfer movement, banking etc. And when we talk about cross-border money transfer remittances, it is especially over there. So it’s not, it’s not immune from fraud. However with the advances in technology today, we can make it so difficult to do fraud that it is very difficult to get away with it. So if a person says, you know, maliciously tries to use their own credentials and tries to do a transaction, we can catch it and we can, if challenged, we can not only take it to court, but we can also win it.

The technological advancements have come to a stage where it is very easy to mitigate fraud. It is very easy to restrict it and you know there’s identity technology, we can look at your identity documents, we can look at passport, driver’s license, your face and match it to facial recognition. We can do device fingerprinting, we can do IP restrictions, we can check if an IP is coming from a proxy or not, we can tunnel through, we can do cookies. We can do many many things that are very difficult for a fraudster to overcome. There is fraud. Traditionally in one in a hundred transactions the fraud is very very low. It’s maybe one in 500 and so forth.

Sometimes a wife may be sending money back home and she has maybe $1500 in her account, and she’s sending $1000 back home only to have forgotten that the husband wrote a cheque for $750. So, non sufficient funds, you know, type requested to come back, but they’re chargebacks mostly, and they can be taken care of. But fraud itself. Very very low.

I hope I was able to answer the question. If you have any more, feel free to ask in the comments section below. Till next time, have a good one.

This page was last updated on September 1, 2022.

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