How Can Banks Combat Online Dating Romance Scams?

Thanks to technology, you can talk to people from any corner of the globe. Some even find love online and go on to have happy marriages. Unfortunately, some people on dating websites have sinister ideas. Romance scammers make their victims believe that they are in a romantic relationship.  

Once they gain their partner’s trust, they empty their bank accounts. According to the Federal Trade Commission, romance scam victims lost $304 million in 2020. This article looks at how banks can protect their clients from online dating scams.

Transfer Limits

Each bank has its own set of rules and regulations. However, all banks have some transfer limits depending on the type of account you have. If you exceed this limit, the bank typically charges you an “excessive use fee.” By imposing a transfer limit, their clients cannot lose all their money in a day. It allows time for other interventions before the account has been drained.

Monitoring for Unusual Activity

Most people have a predictable spending pattern; you pay your bills and make the occasional large purchase like a car. Banks have detailed records of your spending patterns going back years. They also know whether you send money overseas. When you start withdrawing large sums and sending them to foreign accounts, they will ask questions to verify the activity.

They can flag an account they suspect is being targeted by a scam by filing a Suspicious Activity Report (SAR). Banks detail their suspicions and forward the report to the relevant authorities. Their system will also automatically raise an alert if their algorithm detects suspicious activity.

Educating Consumers

Money lost to online dating scams is often impossible to retrieve. Like many things, prevention is often the best cure. Banks can take precautions by educating their customers. The information provided to consumers should include how online dating scams work and the common red flags. These include:

  • The romantic partner is falling in love too soon.
  • The person is in a hurry to get your personal information, such as your email if you met on a website.
  • The person is always in some emergency and requests money from you.

Banks should also encourage their clients to notify them right away and not feel ashamed. Educating customers helps equip them to handle such a situation should it arise. Knowing that it’s a common problem also gives them the courage to report since the situation can be very embarrassing.

Final Thoughts

Scammers take advantage of emotional connections. Even a rational person can be erratic when it comes to love. Although banks can’t prevent clients from accessing their money, they can intervene before it’s too late.

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