Policy paper

Money mule and financial exploitation action plan (accessible)

Published 1 March 2024

2024

Introduction

Money muling allows criminal gangs including drug dealers, people traffickers and fraudsters to profit from ruining people’s lives. It is crucial that we act to make it harder for criminals to exploit victims and benefit from their crimes. This Action Plan sets out how the Government is leading an ambitious cross-sector response to disrupt money mule activity and protect victims of related financial exploitation.

Money muling involves criminals employing others to move the proceeds of crime on their behalf. While money muling can take many different forms one of the most common is when a criminal offers cash in exchange for the use of someone else’s bank account. They then move illicit funds through a complex network of mule accounts to obfuscate the operation, allowing them to cash out their profits.

The money mules involved in moving funds can choose to do so willingly and be complicit in money laundering. Criminals also target some of the most vulnerable in society, including children and adults at risk, and exploit them into facilitating the movement of illicit funds. These people are themselves victims of the criminals behind money muling.

The criminals behind this act reprehensibly, with reports of children as young as 11 being recruited to move funds. They operate in person and online, including on social media and gaming platforms popular with young people.^{[footnote 1]}

Money muling facilitates many kinds of crime and allows fraud to flourish. Fraud is the most common crime in England and Wales, accounting for almost 40% of all offences,^{[footnote 2]} damaging our economy and destroying lives. The majority of organised frauds rely on money muling to clean the funds taken from victims.^{[footnote 3]}

The scale of the problem across all crime types is huge, with the National Crime Agency (NCA) estimating that over £10 billion is laundered via money mule activity in the UK annually.^{[footnote 4]} In 2022, UK banks identified over 39,000 accounts demonstrating behaviour indicative of money muling.^{[footnote 5]} The Payment Systems Regulator published data in October this year that showed the scale of the issue, and of particular relevance, highlighted the firms that receive funds derived from certain fraud types.^{[footnote 6]}

This complex problem requires a system-wide response, led from the heart of Government. The Action Plan sets out how government, law enforcement, industry, regulators, and charities will work together to achieve this. It outlines activities in five key areas:

• protecting the public

• understanding the threat

• safeguarding victims

• pursuing criminal gangs

• disrupting transactions

This innovative Action Plan builds on commitments made in the Economic Crime Plan 2 and the Fraud Strategy to tackle the issue of money muling and related financial exploitation.^{[footnote 7]} The Action Plan will cover England and Wales. While policing policy is devolved in Scotland and Northern Ireland, and financial services are also a reserved matter, many of the actions in the Action Plan will help protect individuals and disrupt criminality across the UK.

Action list

Protecting the public

Action	Lead organisation(s)
Publish guidance on money laundering-linked financial exploitation for frontline professionals.	Home Office
Deliver a communications campaign to raise awareness of money mule recruiters.	National Crime Agency (NCA)
Develop a website hosting resources for education and support.	NCA
Secure commitments through sector-focused charters from industry to deliver consistent messaging.	Home Office
Build on the national Cyber Protect Network to include money muling and related financial exploitation.	City of London Police (CoLP)

Understanding the threat

Action	Lead organisation(s)
A pilot project to share data on money mule prevalence to support a focused approach to prevention.	CoLP and Cifas
Produce intelligence reporting in collaboration with cross-sector partners, in line with broader tasking priorities.	NCA
Explore options for research to develop a deeper understanding of involvement in money mule networks.	Home Office
Share data insights with the banking industry and law enforcement quarterly.	Cifas

Safeguarding victims

Action	Lead organisation(s)
Create a new specialist post at The Children’s Society covering money laundering-linked financial exploitation.	Home Office
Pilot a support service for victims of money laundering-linked financial exploitation.	Home Office
Investigate a data sharing solution to make it harder for mule recruiters to operate between banks.	Cifas
Work with banks and local authorities to ensure victims are not removed from the banking system.	Home Office

Pursuing criminal gangs

Action	Lead organisation(s)
Work with industry to trial new ways of disrupting money mule networks.	NCA through the National Economic Crime Centre (NECC)
Update Money Laundering prosecution guidance to recognise financial exploitation, culpability and public interest considerations.	Crown Prosecution Service (CPS)
A new law enforcement unit to improve the police response to money mules.	CoLP

Disrupting transactions

Action	Lead organisation(s)
Establish a unit to strengthen the public-private response to crypto illicit finance.	NECC
Create best practice guidance for how the financial sector should respond to money mules.	UK Finance
Pilot the Fraud Overlay project, applying new technology to disrupt networks of fraudulent payments.	Pay.UK
Develop work on Firms’ Fraud Controls, including deep dives into money mule controls.	Financial Conduct Authority (FCA)
Publish FCA findings on money mules, setting out good practice and areas that need development.	FCA
Implement a data sharing approach to enable both sending and receiving banks to detect high risk payments and prevent fraudulent transactions.	Pay.UK and UK Finance

Context

What is money laundering?

Money laundering is the process by which the proceeds of crime, such as illegally obtained funds and property, are moved by criminals to make them appear legitimate. These proceeds can come from crimes such as modern slavery (including human trafficking), drug trafficking and fraud.

Money laundering is a criminal offence. Punishments are severe and can include custodial sentences of up to 14 years in prison and/or an unlimited fine.^{[footnote 8]}

What is ‘money muling’?

Money muling is when an individual, commonly referred to as a ‘money mule’,^{[footnote 9]} moves the proceeds of crime on behalf of criminals, sometimes in exchange for payment or other benefit. They help hide the origin of illicit funds in various ways, including moving them through their own bank account (or multiple accounts), buying and selling cryptocurrencies, or withdrawing cash and handing it over. ^{[footnote 10]} Money mules can also give control of their accounts to criminals to enable them to transfer the funds themselves. Each transaction helps to further obfuscate the trail of the funds and ultimately to launder the funds.

What is ‘financial exploitation’?

Financial exploitation is used in this Action Plan to describe exploitation which takes place for the purpose of money laundering. This is when criminals target children and adults at risk,^{[footnote 11]} and take advantage of an imbalance of power to coerce, control, manipulate, or deceive them into facilitating the movement of illicit funds. People can be financially exploited in other ways, for example as part of domestic abuse, but this plan focusses on instances related to money laundering. ^{[footnote 12]}

What are ‘money mule networks’?

Money mule networks are groups of people or accounts used by criminals to launder funds. Criminals controlling these networks will organise or direct transactions between their victims and money mules while maintaining their own anonymity. It should not be assumed that those in these networks will know the identities of the others involved.

Those controlling these networks are commonly referred to as money mule ‘herders’, ‘controllers’, or ‘recruiters’.

Consequences

Money Mules

Money muling is a type of money laundering, which is a criminal offence. There are long-term legal and financial consequences for those knowingly and willingly involved. These include, but are not limited to:

• Up to 14 years in prison.

• Being flagged as involved in illegal activity on a banking-sector wide database. This can lead to:

  • The closure of bank accounts.

  • Existing loans or credit facilities being made payable immediately.

  • Difficulty opening new accounts and applying for credit (including mobile phone contracts, student loans, and mortgages).

  • Issues trying to get jobs in the future.

  • Dismissal from higher education and professional bodies. For instance, lawyers and doctors could have their licences revoked or applications for new ones rejected.

Some people may unknowingly become involved in this type of money laundering. For example, criminals might manipulate them into moving money through their account as part of a romance scam or use stolen documents to fraudulently open accounts in their name. Circumstances such as these are taken into account by law enforcement and banks.

Victims of financial exploitation

People who are financially exploited are victims. While they might have been exploited into breaking the law, the safety of victims will always be put first by statutory services. Asking the police for help and making them aware of any concerns about financial exploitation can be the first step to ensuring that a victim gets the support they need, and criminals stopped. This can seem daunting, and some people might think that going to the police will get a victim into trouble.

However, this is not the case. The police have a duty to safeguard and protect any child or adult at risk, and victims should expect police officers to deal with concerns promptly. Victims can expect the police and other statutory services to assess all the information available and choose an appropriate safeguarding response.

The Home Office has published guidance on money laundering-linked financial exploitation and how to react when you suspect someone may be a victim.

Co-ordination

Co-ordination is vital to ensure the system wide response to money muling and related financial exploitation is effective, considers the latest evidence, and makes the best use of the resources available. It also helps to concentrate efforts where they are most needed and reduces potential duplication.

Protecting the public

Public polling shows that only 1 in 4 people think that money muling is illegal, and over a third of young people aged 16-24 surveyed did not realise it was a crime. A similar proportion had been involved themselves or knew someone who had^{[footnote 13]}. Informing the public about the dangers of money muling and the links to criminality will stop more people getting involved. Materials to do this need to be targeted for different audiences and delivered through mechanisms that will maximise their impact.

Much progress has already been made. The Home Office, UK Finance and Cifas have developed educational materials for students, while Charities are also focused on improving understanding of financial exploitation and have led awareness campaigns and produced resources for victims, their families, and practitioners.

The NCA, UK Finance and Cifas have delivered online awareness campaigns aimed at those aged 18 and over.^{[footnote 14]} UK Finance are currently implementing their Take Five campaign, which is being run nationally and offers straightforward and impartial advice on protecting yourself from financial fraud. In universities, law enforcement and banks have supported the Crooks on Campus campaign. HMRC has also worked to engage university leaders on how best to educate their students about the risks through the UK’s network of Vice Chancellors. The NCA has also worked with UK Visas and Immigration to provide tailored messaging to at risk international visitors and students.

Actions

1. The Home Office will publish guidance on money laundering-linked financial exploitation for frontline professionals. Raising awareness and understanding of this type of exploitation amongst people working with those at risk will help to identify and support victims. The guidance will clearly define this type of exploitation, explain the signs to look for, and make clear what professionals should do to make sure victims get the help they need.

2. The NCA will deliver a communications campaign to raise awareness of the risks of, and how to protect yourself from, money mule recruiters. This will aim to encourage fewer people to engage in money mule activity and to help them recognise it if they are approached.

3. The NCA will host a central website to make education and support resources more easily available to children, parents, frontline professionals and education providers.

4. Through sector-focused fraud charters, the Home Office will seek commitments from industry to deliver consistent messaging to educate customers and users on money laundering and related financial exploitation. Best practice for effective communications should be shared within and across industries to improve consistency of approach.

5. City of London Police (CoLP) will build on the national Cyber Protect Network to include fraud, money muling and related financial exploitation. This will support law enforcement’s ability to deliver clear and consistent messaging to stop people becoming money mules and help victims of financial exploitation.

Understanding the threat

Efforts to improve education and awareness must be driven by intelligence and data if our approach is to be effective. Work is underway to improve how data is managed and intelligence effectively shared, with significant improvements across sectors. For the first time, the NCA has shared an intelligence assessment on money muling with the banking and tech sectors to inform their response and decision making, while third sector organisations are assessing how young people are affected to make their interventions even more impactful.

The Home Office and tech companies have agreed an Online Fraud Charter which will see industry take measures to educate users whilst also implementing processes to detect and block fraudulent materials, improve the ways in which users and law enforcement can report fraudulent materials, and improve the speed with which the content and accounts are taken down. The Online Safety Act will create a legal requirement for online platforms to take steps to address fraud and money laundering (including mule recruiters) on their platforms and increase transparency reporting.

Actions

6. CoLP and Cifas will explore a pilot to share thematic data on money mule prevalence and location, to support a focused approach to prevention. This will enable law enforcement to deliver preventative messaging where it is most needed, disrupting the activities of mule recruiters and protecting the victims of their crimes.

7. The NCA National Assessments Centre will produce intelligence reporting in collaboration with cross-sector partners as the threat evolves, in line with broader tasking priorities. This is part of their work to provide a single picture of the threat to the UK from serious and organised crime.

8. Home Office will explore options for new research to develop a deeper understanding of how and why people get involved in money mule networks. This will aim to understand links with other forms of exploitation such as county lines and allow prevention and safeguarding activity to be better targeted to stop more people getting involved.

9. Cifas will share relevant data insights with the banking industry and law enforcement on a quarterly basis. This could include information on demographic trends and the prevalence of accounts which show signs of money muling. These insights will inform how resource is prioritised to best tackle the threat.

Safeguarding victims

Where criminals coerce, control, manipulate, or deceive children or adults at risk for the purpose of money laundering, the people they target become victims of financial exploitation. This can occur in isolation or alongside other forms of harm and exploitation such as county lines, or child sexual exploitation. It is vital victims receive the support they need, and that the system-wide response recognises this type of exploitation.

The Home Office has united a coalition of partners to ensure that victims are recognised and receive the appropriate response. Banks are adapting to this evolving landscape and have come together to understand what more they could be doing, while the third sector is increasingly emphasising the harms that these victims experience and how we can improve outcomes for them, such as the ID Fraud Checklist being rolled-out by Cifas and UK Finance. There is still much left to do, and the Home Office is committed to driving forward the necessary reforms and new approaches to ensure victims have the support they need.

Actions

10. The Home Office will create a new specialist post at The Children’s Society to embed money laundering-linked financial exploitation in their Prevention Programme.^{[footnote 15]} This will enable expertise on how children are being impacted by this type of financial exploitation to be shared, new initiatives to be piloted, and training and educational materials to be developed and delivered.

11. Home Office will pilot a support service for victims of money laundering-linked financial exploitation. Support could also be extended to money mules willingly involved as an intervention to prevent re-offending.

12. Cifas will investigate the opportunity for a data sharing solution to make it harder for criminals to move people, including victims of money laundering-linked financial exploitation, from one bank to another. The solution would seek to improve cross-industry visibility of potential victims of financial exploitation, helping them to access support and enabling banks to apply additional account safeguards where necessary.

13. Home Office will work with banks and local authorities to ensure vulnerable or exploited people are not removed from the banking system. We will develop a new protocol to make it easier for statutory services to notify a bank when someone is a victim of money laundering-linked financial exploitation. This will ensure that victims are not unfairly penalised if money laundering is detected on their account.

Pursuing criminal gangs

The NCA estimates that at least £10 billion of illicit funds is moved through mule networks each year.^{[footnote 16]} Criminal recruiters use social media platforms and other means to lure the public into their networks to launder the proceeds of organised crime groups.

Law enforcement agencies across the country constantly update their approach to fighting crime in line with the changing threats they face. Last year, the NECC with policing piloted a new cease and desist approach,^{[footnote 17]} utilising data from the banking sector, as part of Europol’s annual global intensification period called European Money Mules Action (EMMA). Intensification periods denote a concentration of law enforcement activity on a particular issue. This co-ordinated international activity in autumn 2022 resulted in 8,755 money mules being identified globally, alongside 222 money mule recruiters, with 2,469 people arrested.^{[footnote 18]}

Law enforcement has now published additional guidance on how to tackle lower-level money mules through a cease-and-desist approach. A similar approach has been used within the US for money mules facilitating large-scale criminal fraud schemes,^{[footnote 19]} with reports that approximately 80 percent of money mules who receive warning letters stop facilitating fraud. The NCA and financial sector continue to trial new approaches to identifying recruiters and controllers.

Criminals exploit online platforms to recruit money mules (sometimes enticing them with financial incentives) and to target potential victims. The recruitment of money mules can be overt or deceptive, misrepresenting the dangers of being involved and downplaying the harm caused by the initial criminal act which generated these illicit funds.

Actions

14. The National Economic Crime Centre (NECC) will work with industry to deliver intensification periods to trial new ways of disrupting money mule networks. Public and private sector partners will collaborate to ensure that these intensification periods, aligned with the global ‘Operation EMMA’, take the latest intelligence into account. Intensifications will bring extra focus to ongoing efforts to target recruiters, deter individuals willingly involved as money mules and to safeguard victims of money laundering-linked financial exploitation.

15. The Crown Prosecution Service (CPS) will update its guidance for prosecutors on money laundering so that it recognises money laundering-linked financial exploitation, culpability of money mules and public interest considerations.

16. CoLP will establish a new intelligence unit to improve the police response to money mules and the laundering of the proceeds of fraud. The new unit will target money mule herders. Proactive Economic Crime Teams within the ROCU network will take action on the intelligence the unit compiles.

Disrupting transactions

Most money muling happens when the proceeds of crime are transferred between bank or crypto exchange accounts. However, other payment methods, such as cash, money service bureaus, and gift cards, can also be used. Making it harder for criminals to move funds through their money mule networks should deal a significant blow to their operations. By going after their money, we aim to reduce the incentive for criminals to commit offences in the first place, protecting more potential victims.

Banks see transactions in real time and already disrupt much of this activity. They also carry out checks when accounts are opened and respond to reports from law enforcement or fraud victims. Some successful cross-sector initiatives already exist, such as Cifas’ work to share data on accounts involved in money muling and Vocalink’s sharing of transaction data associated with fraud. However, more work in this area, with more financial institutions involved, is key to stopping more criminals profiting from their crimes.

Next year the Payment Systems Regulator (PSR) will implement mandatory reimbursement to victims from banks that receive the proceeds of authorised fraud. This will incentivise PSPs to address money mule accounts by attributing 50% of the cost of reimbursing fraud victims to the PSP that received the proceeds of a fraud. The PSR has also published new data showing which banks and PSPs are most used for frauds and scams. This allows vulnerabilities at particular institutions to be addressed swiftly and best practice to be shared following successes at high-performing institutions.

Actions

17. The NECC will establish a private-public cell under its Public Private Operational Board to strengthen the public-private response to emerging crypto illicit finance. Subject to tasking and operational priorities, this could include a focus on how the crypto exchanges are being used by the criminals behind money mule networks to move the proceeds of fraud out of the banking system.

18. UK Finance will create best practice guidance for how the financial sector should respond to money mules. This will improve the support for smaller or newer institutions reporting high levels of mule activity on their accounts and help to standardise a comprehensive response across the financial ecosystem.

19. Pay.UK will pilot the Fraud Overlay project (a project that uses new technology to disrupt networks of fraudulent payments). This will provide industry with a chance to upgrade existing technology and data sharing agreements to track and analyse fraudulent payments through money mule networks. In turn, this will generate new intelligence and tools which will enable banks to detect high-risk payments more easily.

20. The Financial Conduct Authority (FCA) will continue to develop work on Firms’ Fraud Controls, including deep dives into money mule controls. This could lead to new guidance being published to help firms improve controls to prevent accounts being abused by mule networks.

21. The FCA will publish findings of its work on money mules, setting out good practice and areas that need further focus and development.

22. UK Finance and Pay.UK will implement a data sharing approach to enable both sending and receiving banks to detect high risk payments and prevent fraudulent transactions in real time. By sharing risk factors between both parties, including where the receiving account may not be what it seems (for example, a payment for an investment going into an account belonging to a teenager), more transactions can be disrupted, and more mule accounts identified.

Implementation

Implementation of the Action Plan will require close working across the system, utilising the unique capabilities of every partner, each of whom will play a specific and vital role. The Home Office will monitor progress made against the actions set out, with named action owners retaining responsibility for delivering them.

Governance

The Home Office-led cross-sector Mules Delivery Group will be used to track delivery of this action plan. This group is chaired by the Home Office’s Fraud Policy Unit, with representation from government departments, regulators, law enforcement, industry, and the voluntary sector. This will be supported by action-specific monitoring by delivery partners.

Delivery of this action plan is a commitment in the Government’s Fraud Strategy, with oversight provided by the governance structures set out in the Strategy.^{[footnote 20]}

Delivery Partners

This action plan will be delivered in close partnership with action owners, as well wider stakeholders such as, police forces, banks, online platforms, local authorities, charities and other frontline professionals. Delivery partners include:

1. Government departments, agencies and regulatory authorities including:

• Home Office (HO)

• Crown Prosecution Service (CPS)

• Financial Conduct Authority (FCA)

2. Law enforcement, including:

• City of London Police (CoLP)

• National Crime Agency (NCA), including the National Economic Crime Centre (NECC)

3. Partners across industry and the voluntary sector including:

• Cifas

• Pay.UK

• The Children’s Society

• UK Finance

1. NCA Intelligence Analysis 2023, social media-based approaches have been assessed as highly likely to be the most common approach. ↩

2. Crime Survey England and Wales, year ending March 2023. ↩

3. NCA, SARS in Action Issue 20 v1.2 (nationalcrimeagency.gov.uk). ↩

4. NCA, National Strategic Assessment (NSA) Campaign 2023 - Money Laundering - National Crime Agency. ↩

5. CIFAS ‘Fraudscape 2023’. ↩

6. PSR APP report. ↩

7. Fraud Strategy: Fraud Strategy: stopping scams and protecting the public (accessible) - GOV.UK (www.gov.uk), Economic Crime Plan 2: Economic Crime Plan 2 2023-26 (publishing.service.gov.uk). ↩

8. Money Laundering Offences | The Crown Prosecution Service (cps.gov.uk). ↩

9. ‘Money mule’ is a term that is widely used to describe this activity, but which can have different interpretations across the system. ↩

10. Some money muling includes the movement of physical cash with no reliance on a bank account. ↩

11. The term ‘adult at risk’ is shorthand for ‘adult at risk of abuse or neglect’. It is defined in the Care Act 2014 for England and the Social Services and Well-being (Wales) Act 2014. It replaces the historic term ‘vulnerable adult’. ↩

12. Financial exploitation is a form of criminal exploitation. It can take place in isolation or alongside other forms of exploitation, and when the victim is under 18 years old, this is a form of child criminal exploitation. ↩

13. Cifas and Opinion Matters survey, August 2022 (survey sample: 2,000 UK adults). ↩

14. Including “Money Mules - National Crime Agency” and “Money Mules – If it sounds too good to be true, it probably is.”. ↩

15. The Children’s Society Prevention Programme is a programme aiming to transform the spaces that children spend time in and the organisations that they come into contact with. The team works across England and Wales to drive forward new responses to prevent and improve responses to exploitation and abuse. More information is available online: Child Exploitation Programmes | The Children’s Society (childrenssociety.org.uk). ↩

16. NCA, National Strategic Assessment (NSA) Campaign 2023 - Money Laundering - National Crime Agency. ↩

17. Cease and desist uses letters and in person visits by law enforcement to warn people of the illegality of their actions to deter further offending. ↩

18. Europol reporting on 2022 ‘Op EMMA’ mules intensification: 2 469 money mules arrested in worldwide crackdown against money laundering | Europol (europa.eu). ↩

19. FinCEN Director’s Law Enforcement Awards Program Recognizes Significance of BSA Reporting by Financial Institutions. ↩

20. Fraud Strategy: stopping scams and protecting the public (accessible) - GOV.UK (www.gov.uk). ↩