The Decibel - Where your money ends up after a scam

Episode Date: April 30, 2026

Once scammers successfully steal someone’s money, they need a place to stash it. So they are buying verified Canadian bank accounts in order to launder money. In the last 12 months, a Canadian cybercrime research firm identified 4,337 social media posts offering to purchase accounts. The people who allow scammers to use their accounts are known as “money mules”. Many become implicated in the crime, even if they are recruited without knowing they are being used to launder money. Alexandra Podazki is the Globe’s financial and cybercrime reporter. Today, she joins the show to explain what exactly is happening with this black market for verified bank accounts and why the demand for money mules seems to be growing. Questions? Comments? Ideas? Email us at [e-mail] Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

We hear about people getting scammed out of their money. But what happens after that? Where does the money go? The answer is often a complex trail of verified bank accounts that get repurposed by scammers. And how scammers get to these accounts is often by recruiting people through social media. People who answer these posts can become something called a money mule and sometimes unknowingly participate in a crime. Alexandra Posatsky is the globe's financial and cybercrime reporter, and she's been looking into these cases. She's on the show to explain who is being targeted, what happens once a scammer gets a hold of one of these accounts,

and what financial institutions are doing to try to stop these incidents from happening. I'm Cheryl Sutherland, and this is the decibel from the Globe and Mail. Hi, Alex, thanks so much for coming back in the show. Hey, great to be here. So we know that once a scammer gets money from a victim, They're on the hunt for a regular or a verified bank account. Why do they want this specific kind of account? Essentially, they need a way to move the money that they have stolen from a scam victim

and get it into their own hands, into their own bank accounts, or often offshore to a place where local law enforcement can no longer seize those funds. So the reason they're called verified bank accounts is in contrast to what might be, for instance, a hacked bank account or a compromised bank account. or a compromised bank account. And so if you are using a compromised bank account in order to move, let's say, scam proceeds or proceeds of other crime, that account is going to get flagged by a bank as being compromised pretty quickly. Let's say you got locked out of your bank account.

The first thing you're going to do is get on the phone with your bank and go, hey, someone stole my bank account. A verified Canadian account is one in which the identity of the person supposedly owning the account has already been verified, it's been checked by the bank, and the bank thinks that everything is kosher. And so these accounts are less likely to be flagged as quickly as being involved in some sort of illicit activity. Is there something about Canadian bank accounts that make them specifically attractive for this kind of crime? Well, if you're dealing with scam victims in Canada, I mean, that might be a reason to have a Canadian bank account because it's going to be easier to transfer those funds from one Canadian bank account to another Canadian bank account.

And we know that Canada is generally a pretty wealthy country. So we are often targeted for scams. Not just Canada, of course, the United States. Australia, as we've learned, the UK, these are all kind of countries that are considered attractive places to victimize people. Okay. And this is where money mules come in. What is a money mule? A money mule is essentially somebody who moves money for somebody else. And so they're sort of like a financial intermediary. And it's usually for the purpose of disguising some sort of illicit activity. All right. And so in this circumstance, a person is considered a money mule because they are allowing money to pass through their account.

Is that right? That's right. Or they could be, you know, moving cash for somebody or moving crypto for somebody or other things of value. How do people become money mules? That is a great question. and what I've learned is that there are a number of different ways in which this can happen. Some people are knowingly becoming money mules. So they know that essentially they're doing something illegal.

They're moving money for scammers or criminals. Other people actually get tricked into becoming money mules. So you know those text messages you get, offering you some kind of a work-from-home job? Oh, my God, yes. I get so many of those. Sounds too good to be true, right? Often the job is that you're processing payments for somebody. but you're doing it through your own bank account.

And so in that case, you might unknowingly be doing the job of a money mule. That's fascinating, Alex, because, like, you have just connected some dots for me. I had no idea what was on the other end of that. Of course, I know it's a scam, but interesting to know that this is how you could get into this money mule world. So for those who aren't tricked, because there are some people that are doing this knowingly, what's the sell? Like, how much do these mules get for participating? So what we've been hearing, and a lot of this actually comes from the Australian federal police,

who did a whole big awareness campaign around this. What they're seeing and what we're seeing in other countries as well, including in Canada, is essentially criminals approaching international students quite often and saying, hey, you're going back home to whatever country you're from. And I know you probably had a Canadian bank account while you were here living and working or studying in Canada. and I'm assuming you're not going to need that bank account anymore. So why don't I give you $200, maybe up to $500 for your bank account? And in some cases also sort of a cut of any money that moves through that account.

So sort of like maybe a 10% commission. And those students, you know, who are maybe paying really high tuition fees, feeling really financially strapped, see it as a way to make some easy and quick money. Okay. So is this kind of the reason? why students are being targeted as they're seen as vulnerable and perhaps more likely to go into this world? Yeah, I mean, think about it. If you're an international student, your tuition fees are so much higher than a domestic student. But on top of that, English might not be your first language.

The culture, the law enforcement culture of the country may be sort of foreign to you. So you might maybe not necessarily realize what kind of thing you're getting involved in. You might have a sunset. that perhaps it's not exactly on the up and up, but you might not realize that you could, for example, be held liable for money laundering. How big of a problem is this black market for bank accounts? So I spoke to this cybercrime research firm called Flair that's based in Montreal,

and they told me that they see thousands of these posts advertising Canadian bank accounts for sale or people looking for Canadian bank accounts in a recent 12-month period. Can you give me some examples to help me understand, how this works, because I understand for the story, you have found some people that this sort of happened to. Yeah. So tell me, tell me about some examples. Yeah. So unfortunately, the examples were not very cleanly the exact specific examples that the bankers and the Australian law enforcement had been warning about of people specifically approaching students, either through chat apps or even in some

cases in person on campus and then just offering them cash for their accounts. But I did find cases in front of the Immigration Board involving individuals who had been studying in Canada. They were foreign students who did act as money mules. And in one case, the individual actually had been told that they were doing a job for somebody and that they were processing payments. And so they would actually receive cash. And then they would sometimes take that cash and deposit it into a U.S. bank account. And there was another case I encountered, which was kind of a strange one,

where they believe that they were actually applying for help to a lawyer to help them either get their residency status or to help them get employment in Canada and that they would receive an envelope in the mail and just, you know, open up the envelope. Don't look inside where there's apparently $15,000 in cash from a scam victim. Don't look inside. Just open the envelope and put your papers in the envelope and then mail that envelope to this address that this person thinks. was a lawyer. And I believe it was Brampton. And so essentially they're doing something called layering or obfuscating sort of the trail of the money. Okay. So these two examples don't involve their own accounts, but it is an example of how the money moves from that person to another person. So they're kind of acting this as the money mule. Exactly. And when you have money laundering, this is sort of common is that the person trying to launder the money, essentially to wash that

money, they want to obfuscate that trail as much as possible. And so there will often be multiple transactions, the money passing through multiple hands, which makes it harder to clearly trace where that money has ultimately come from, which is from a crime. Okay, we talked about the scam and about these accounts that are working to launder money. How do these accounts get detected? Yeah, that's a really interesting part of the story. So I spoke to banks, I spoke to interact, I spoke to consultants and I wanted to learn about some of the interesting work happening in the space to actually identify and crack down on this kind of behavior. And one of the things that I learned is that they're using artificial intelligence to try to take down these accounts.

So one of the things that they're doing is creating these maps of essentially networks of mule accounts. So when you have a mule account, it's not necessarily like an isolated account, right? You're going to move that money from one account to another account to another account. And there's going to be a series of transactions. They refer to it as either a one to many or a many to one. So you might have a lot of different scam victims moving money into one, right? That's the many to one. Okay.

Or you could have the one to many at that point. It's that one account moving money out to a lot of different accounts. And so there's these kinds of networks of these accounts. And what they're doing is actually using this graph-based machine learning to sort of map out these networks so that they can actually dismantle the whole network at the same time. So the map is really clarifying to me. Yeah, how do they know where these accounts are? Like, is it, are they flagged?

Like, explain that to me. So there's this thing that happens that was referred to as sort of like a breakout point or an inflection point, which is you'll have an account. Let's say it's a student account, right? And it's, let's say the student's been in Canada for two years and they're paying their rent. And, you know, maybe once a year they get a big. cash infusion from their parents to cover their tuition or from OSAP or whoever and then that money quickly goes to the university and aside from that it's you know rent or a bar tab or groceries at the grocery store and so it looks like kind of a normal account and then all of a sudden at a certain point in time you might see suddenly large sums of money moving in and out of the account very quickly so that's kind of like the inflection point or the breakout moment where that account seems to now no longer be be a regular student account. It seems to be being used illicitly to move the proceeds of crime.

And so that might be kind of the thing that flags that this account has now been compromised or this account has been sold. Of course, hard for the bank to prove that like somebody accepted a couple hundred dollars cash in exchange for their bank account. So it's hard for them to definitively state this account was sold. But I have confirmed, you know, not just with the Australian police, but also with the RCMP that they have dealt with cases involving the buying selling of bank accounts. And so at that point, now that you have that one account that has clearly been compromised, you can look at all the other accounts that are transacting with that account. And so that's kind of how you build the map. Okay. All coming very clear to me.

Something I was thinking about, you know, in my regular life using my bank account, I know that the banks do flag suspicious transactions, right, especially over a certain amount. So wouldn't the bank already be suspicious if something like that was happening or if an account was kind of having irregular activity or if a bunch of money, especially over $10,000 is going through an account? Absolutely. And I mean, they are taking down these mule accounts all the time. It's just a bit of a game of whackamol because, you know, and actually this is one of the things that I heard from the experts when I started asking like, why are we seeing an increase in the number of bank accounts being bought and sold online? One of the answers was, well, the banks have become so good at

dismantling them, that the criminals constantly need more new accounts. Oh, my goodness. So it's the opposite effect. You're taking down the accounts and there are more accounts that are popping up. Yeah, because you still need to move the proceeds of your fraud somehow. Okay. And then, of course, there's also the fact that we're just seeing this tsunami of scams, right? And so the more scams you have, the more money you need to move. And so the more accounts you're going to need to move. And so as the banks work to crack down on these accounts and take them down, you're just creating this need for more bank accounts, essentially. We'll be right back. Okay, we've got a great overview of how this all works. But how does law

enforcement figure out if someone has been duped into being a mule versus someone who is consciously participating? I mean, I think that's really difficult to do because, of course, if you're accused of being a money mule, the first thing you're probably going to do is get a lawyer. And so in reading some of these cases in front of the immigration board, what I learned was that basically any time that somebody gets accused of being a money mule, they, through their lawyers, will argue, like, I had no idea. I thought I was just doing a legitimate job. And, you know, then they'll do like a deposition and they'll be asked, like, well, what, did you look inside the envelope? Did you see that there was $15,000 of cash from this victim of a tech scam in the envelope?

And they'll say, no, because I was told not to look inside the envelope because I was told that there were sensitive immigration papers of other candidates. You know, there's like two parts of a crime. there's the mens rea and the actus reus, there's the act, and then there's kind of like the guilty mind, the intention to commit the crime. And so it can be quite hard to establish that, yes, this person intended to commit this crime, particularly if they are, let's say, a vulnerable international student who maybe is feeling isolated. Maybe they don't really know how the customs in Canada work. Maybe they don't quite clue into the fact that you wouldn't necessarily photocopy your passport and put all of that into an envelope and mail it to some random address. in Brampton. Yeah. So, Alex, what are the consequences for being caught as a mule if you've been tricked into it? I mean, you could get deported for essentially being part of a criminal organization. So I have seen some of these decisions. You know, there were somewhere. There were no deportation orders issued. And then there was one where they deported the individual because they said it was clear that they were part of a criminal organization, but they didn't have enough evidence to say that

the individual had partaken in the crime of money laundering. And so they weren't charged with money laundering, but they were deported from Canada. So, you know, you can get kicked out of the country if you're still here. If you're no longer in the country where the crime was allegedly committed, perhaps you're now banned from ever visiting that country or moving to that country again because this is on your record now. And there can be charges, right? It just becomes a question of how hard do law enforcement want to work to try to charge and prosecute someone who's no longer in the country? So for example, one of the case studies, that I saw in the report from Australia involved this woman who had transferred close to 300,000 Australian dollars from her bank account as part of a scam, and the police were

trying to trace the money, and they traced it to 11 different bank accounts, and most of them had been opened by these international students from India. And then they went and followed that money and found it had been withdrawn from ATMs, but the students who owned those accounts had actually already gone back home to India. And so at that point, it's pretty obvious that the students are no longer the ones operating those accounts. Now, the Australian police actually did go after a few cases. And they weren't able to share a lot because some of those cases are actually still before the courts. But they had some guilty pleas.

And so there can be consequences for these individuals. And that's what their whole awareness campaign, which they called your name, your responsibility was all about. It was all about trying to warn students that if you do this, you might think it's a little bit of easy money, but actually you could be held liable for money laundering. You could be held responsible for those. And I want to just to zoom in on that $300,000 you talked about because that's a huge sum of money. And I think it goes to your point of having a multiple amount of accounts. So is that how they worked to be able to kind of like hide how big of a sum that was? They just like put little amounts into each account. Is that how it worked? It might also be to get around

withdrawal limits. Yeah. So if you're trying to withdraw money from a bank account, you're going to hit some kind of a limit of like you can only withdraw X amount of money per day or in a 24 hour period or per week. And so if you move it to 11 different accounts, now you can maybe get all of that money out without hitting those limits. And then what about the people that lost their money in the first place? Because we talked about how this begins with a scam of a person that loses their money. Do they ever get it back? I mean, it's difficult and rare to recover funds. But I have heard stories while working on this beat covering cyber crime and financial crime where people do get some of their money back sometimes. And in fact, there are some initiatives by law enforcement to try to

essentially disrupt fraud in real time while it's happening. So there was a recent initiative called Operation Atlantic that was led by the Ontario Provincial Police and they were actually working with the U.S. Secret Service and with law enforcement in Britain and also with cryptocurrency exchanges and they were focused specifically on a type of crypto fraud where people's crypto wallets are taken over and they were able to freeze, I believe it was $12 million and return that money to victims. So there are cases where people do get their money back, but a lot of the time, unfortunately, they don't. When it comes to these money mules and the use of these bank accounts, what are financial institutions doing to combat the issue? Well, as I mentioned, they're using

AI, for example, to try to identify and take down the accounts. Another thing that they told me about, that's another kind of use of AI besides the kind of mapping, is they're trying to use AI predictively to figure out which accounts are at risk of becoming a mule account almost before it happens, which I found really interesting. So you know that kind of inflection point that I was describing where the bank account goes from sort of ordinary run-of-the-mill transactions to suddenly moving large amounts of money in and out very quickly. They're trying to see if they can use AI to predict an account that is at risk of having that inflection point before it occurs. So I think that's really interesting. Is that not risky? I mean, does that maybe capture people that weren't involved

in this crime? I mean, ideally you would just put in place maybe some kind of enhanced monitoring so that you're not actually impeding those people's ability to access banking. But I mean, that is a great question because that's one of the things that we hear about. from the banks all the time when it comes to things like, are the banks doing enough to stop fraud? And they'll say, well, we can do more, but that's going to create friction for the end consumer, because at the end of the day, like, this is your money. And if you want to take your money and wire it to some fraudster who's convinced you that they're your life partner and they're living overseas and they had a medical emergency, they can stop you from doing that. But should

they, like, it is your money. And if they do implement tighter controls, that is going to potentially affect people's ability to access their money for legitimate transactions as well. And so that's always kind of the counterpoint is like they're stuck with this balancing act, right? I'm like trying to stop the fraud, but also not adding too much friction into your ability to do business and move your own money around. What about the Canadian government? Are they doing anything about this issue? Well, I don't know that there's necessarily anything. that specifically is targeting money mules or foreign students that are being recruited as money mules in the way that the Australian police have done this big awareness campaign.

But there is a national anti-fraud strategy that was announced in the federal budget, and there's currently consultations underway on that, and they're actually wrapping up at the end of this month. And so one of the questions that should hopefully be answered as part of that is, who should be held liable for those losses? because we've seen consumer advocates and actually the block hebequa come out and say the banks should be liable and they should refund victims of fraud. And what the banks have said is it should be a cross-sector approach because the bank might be the one at the end of the chain who's allowing you to move your money out of your bank account. But, you know, in order for a fraud to happen, there's telecoms involved. You're getting that scam call.

You're getting that scam tax. There's digital platforms involved where the scams are being advertised to you on places like. Instagram and Facebook and maybe telegram. And so there's all these other points of contact within the sort of scam ecosystem. And so I think that might be the direction that the government is leaning towards is. I mean, they've said that what they want to do is kind of a cross-sector approach. So we'll see kind of how they decide to go about that. Yeah, because I guess in this world where scams are becoming way more prevalent, this could be really expensive for banks if they're taking on all the liability. I mean, I guess.

the idea behind that sort of policy is that if you tell the banks it's going to cost you a lot of money, then maybe they're going to take the extra step of preventing the fraud from happening in the first place. To end here, Alex, what does the story taught you about the evolution and sophistication of cyber criminals? I'm always just astonished by how creative the cyber criminals are when you look at how they're sort of socially engineering people. people, one of the things that people I speak to tell me all the time is that the reason why we're seeing this shift to scams versus, like, say, hacking into somebody's bank account is because it's become so much harder to gain unauthorized access to an account. That was sort of a technical problem. And to a large extent, banks have been able to implement controls that have made it much harder for a criminal to just get into somebody's account and transfer the money out. And so instead of trying to go about it that way, they're going to the consumer and they're trying to socially engineer. or trick the consumer into authorizing the transaction. And that's a much harder problem for an institution like a bank to solve. Because now instead of calling up the customer and going, did you authorize this transaction, they're having to call up the customer and go, hey, why did you move this money?

Okay, you're, you know, maybe this person isn't actually the love of your life living overseas. Maybe you were the victim of a scam. And so imagine having that conversation with a scam victim. That's a much harder conversation. that's more hours in the call center. It's just a more difficult problem for institutions to solve. But one of the things that I think all the time is imagine if these scammers who are so creative and so persuasive, imagine if they put that power to good. Imagine what incredible things they could achieve in terms of solving problems for our economy instead of essentially just amounting to what is this

massive wealth transfer from the hands of regular Canadians and businesses to organize crime. Alex, thank you so much for coming on the show. Always a pleasure. That was Alexandra Pazatsky, the Globe's financial and cybercrime reporter. That's it for today. I'm Cheryl Sutherland. Our intern and associate producer, Emily Conahan, produced this episode. Our producers are Madeline White, Rachel Levy McLaughlin and Mikhail Stein.

Our editor is David Crosby. Adrian Chung is our senior producer and Angela Pichenza. is our executive editor. Thanks so much for listening.