At the start of a new academic year, we are asking ourselves a question - what can financial industry practitioners, educators and government authorities learn about teaching young people about financial crime? This topic has sparked a lot of interest in the FFE community when we’ve raised it before, most notably in one of our most popular FFECON sessions, with the VICE journalist Obi Juwah (available to watch on demand).
We’re revisiting this topic through the eyes of a student - Stefan Wlodarczyk, who recently completed a stint of work experience at FINTRAIL. We asked him to investigate what students his age know about financial crime, particularly money muling.
Stefan:
Financial crime is an increasingly common problem, with younger generations becoming more and more at risk. As a 15-year-old secondary student doing work experience at FINTRAIL, I investigate whether my generation is even aware of these risks.
To provide some background:
The UK’s 2020 National Risk Assessment of money laundering and terrorist financing states that there were 42,482 suspected cases of mule activity in 2019, a 32% increase since 2017. 📈
The National Risk Assessment recorded cases of children as young as 13 and 14 being approached on the playground to carry out these operations. 🚸
Teenagers through to university students are being recruited to become mules via social media. 📱Social media has the greatest influence on younger generations since it has become such an ingrained part of society. This makes it so dangerous, and so easy for people to become accidentally involved in money laundering.
Furthermore, the recent COVID-19 pandemic exacerbated the number of financial crime cases due to more people being online.
In 2020, the European Money Mule Action EMMA6 programme identified at least 227 money mule recruiters who recruited over 4,000 mules. According to Cifas, cases of under 21-year-olds being used as money mules fell by 12% in 2020 compared to the previous year, which is still a 27% higher number of cases than in 2017. The change may be due to lockdown restrictions which forced teenagers to stay indoors rather than being recruited to carry out mule work.
The survey: Are younger generations aware of money mules?
I interviewed ten people around my age (15) from four different schools to explore this further.
1. Have you received any education regarding financial crime?
Three out of ten students (30%) said they had received financial crime education, two of them went to the same school. 70% said they had not received any education about financial crime. This is despite Cifas and the PSHE Association (the national body for Personal, Social, Health and Economic education) creating an Anti-Fraud Education campaign targeted at 11-16 year olds.
2. Do you know what money muling is?
Four out of ten respondents said that they knew what money muling was. Out of the four who said yes, three had received education on financial crime.
3. Where did you learn about money muling and financial crime?
Out of the four respondents who knew about money muling and financial crime, three said they learnt about it at school, and one said they had learnt about money muling on YouTube.
4. Have you ever seen an advertisement for money muling on social media?
All respondents said no.
5. Have you ever been approached by someone asking you to use your bank account (if you have one)?
Again, all respondents said no.
6. Have you ever been a victim of fraud linked to social media (e.g. purchase of goods which never arrived, or arrived and did not match the description)?
Only one out of ten respondents said yes. This student frequently uses eBay to buy and sell items, and has been a victim of authorised push payment fraud (being deceived into authorising a payment to a criminal).
7. Have you ever been encouraged on social media to invest in cryptocurrency or any other high-return investments?
Five out of ten respondents said yes to this question, having seen adverts on the internet rather than actually being approached directly on social media. However, I am fairly confident that at least one respondent was actively encouraged to invest.
8. What social media platform do you believe is the most likely to expose you to financial crime?
Five respondents said they believed that Instagram was the social media platform most likely to offer exposure to financial crime, and four said they thought it to be Facebook/Meta.
The results
The results of my survey show that most (70%) of the respondents have not received any education on financial crime. One respondent stated:
“To be honest, our school doesn't teach us anything on finance stuff.”
Interestingly, of two people interviewed from the same school, only one of them said they had received an education on this topic, which they had received the same day I conducted the survey.
Consequently, all students who received an education on financial crime knew what money muling was, yet of those students that did not receive this education only one knew what money muling was. This is because they had seen a video on YouTube about the topic, demonstrating how effective social media can be at spreading information (or encouraging people to become mules).
Thankfully none of my respondents said that they had seen adverts encouraging money muling, or had been approached to become one. Unfortunately though, one respondent said they were a victim of fraud.
“I was dumb enough to send someone money, but the product never arrived. The bank said that I had been scammed, and they gave us our money back.”
The results of question six (on high-risk investments) may be skewed by legitimate online advertisements or social media influencers encouraging people to invest, rather than shady offerings. Although one respondent said,
“A lot of scammers on YouTube are promoting their apps for investment.”
Noting this, I would recommend more research into this area, and the impact of this.
My last question on which social media platforms are most likely to expose users to financial crime had interesting results with Instagram and Facebook/Meta being most commonly highlighted. During my interviews, Instagram came under fire for allegedly having “a lot of ads'' that were “really fake”. Interestingly, one respondent said that they believed that YouTube is the riskiest regarding exposure to financial crime due to the large amount of adverts put out by influencers encouraging people to invest in their apps or programs.
Is enough being done?
Personally, I don’t think enough is being done to educate teenagers and younger children on financial crime risks. I cannot remember ever being taught about this at school, and I only first learned about it by watching a documentary on money muling and from my work experience at FINTRAIL.
The UK government and some financial organisations have released educational resources such as the Don't Be Fooled programme, yet they do not appear to have reached their targeted audience. The reason seems to be because money muling and financial crime isn't exactly a topic that teenagers are interested in or actively seeking out information on.
School is an important educator in spreading awareness about financial crime.
One student I interviewed wasn't happy about the level of education he received. He said, “I did it [finance] at the start of Year 10, and I don't remember much of it. We’re getting weighed down by exams and tests; we need lessons that refresh consistently on that stuff”.
In my opinion, the logical solution would be to designate personal, social, health and economic (PSHE) sessions at schools in the UK to educate students on this hugely important matter. However, I think that it shouldn’t just be one-off lessons but, as suggested by one respondent, “repeat [these] important topics every year”.
Looking ahead: Beyond secondary school students
The problem goes beyond secondary students. A Nationwide Building Society poll found that 56% of university students (compared to 60% of secondary students) did not know what a money mule was. The high percentage illustrates a failure to properly educate students on financial crime issues. The same study states that 61% of the students believed they were susceptible to such advertisements, and 37% admitted that they would respond to or click on such advertisements. 🤯
I believe that in addition to more education, social media companies themselves should do more to prevent mule handlers from recruiting mules in the first place. They can do this by regularly screening users with suspicious hashtags or other indicators similar to “make money quick” in order to see if the user is actively attempting to contact potential victims.
FINTRAIL's Final Thoughts
• There is a real need for greater awareness of financial crime, along with a host of other financial topics, among young people. However, given the competing demands of the school curriculum, the logistics of how to deliver it are clearly a challenge.
• There have been educational campaigns for young people on the risks of money muling and fraud, but they do not seem to have had real impact. Without redesigning the wheel, educational bodies and government authorities should consider the best ways to reuse this material and more effectively raise awareness amongst young people. Static, text-based campaigns focused on the classroom may not be as effective as countering fraudsters and recruiters on their own turf, namely social media.
To read more about money mules and their use of social media and common typologies check out FINTRAIL’s blog posts here.
If you want to get in touch for dedicated money mule training or create educational materials, give us a shout at contact@fintrail.com.