Bank Scams In Mexico - Nov. 2023

Mexico, Online Scammers' Favorite Playground
By Le Monde reporter Anne Vigna
9 November 2023

.   1 in 5 Mexicans have been a victim of bank scams
.   In most cases, the bank "washes its hands of the matter"
.   Efforts to tighten regulations over banks have failed
.   Low paid bank employees are often involved

Phishing, pharming, smishing, call spoofing... online scams still have English names, with no Spanish equivalent. Yet Latin America, and Mexico in particular, has become the preferred playground for cybercriminals looking to empty private bank accounts.

According to a recent study by the Belisario Dominguez Institute, the Mexican Senate's research center, some 15,000 financial frauds take place every day in the country, a record in Latin America. "The National Institute of Statistics estimates that nearly 15% of the Mexican population has already been a victim of fraud, which is one out of every five users. And in 92% of cases, the fraud is successfully completed," explained researcher Juan Pablo Aguirre Quezada, the study's author.

Citizens aren't the only ones whose assets can suddenly disappear. "The central bank, the tax authorities and Mexico-based UN offices have all acknowledged that they have been 'defrauded.' Large corporations don't communicate very much on the subject in order to avoid revealing their fragility, but they have also fallen prey," he added.

Another survey, carried out by the National Commission for the Protection and Defense of Financial Services Users (Condusef), indicates that phishing is the most common scam, accounting for 40% of fraud nationwide.

Bank employees are involved

Few people in Mexico have not received a call, supposedly from their bank, warning them of a "problem" with their account and requesting confidential information in order to "resolve the situation." "The best thing to do in such cases is to hang up immediately and call your bank, because, generally, the call didn't come from them," explained Alejandra Sanchez Inzunza, co-founder of the Dromomanos journalists' collective.

On May 3, €54,000 held in Dromomanos' bank account vanished in a few clicks, and, with them, the employees' next paychecks. "The banks' customer service response is to immediately make you bear the responsibility," said Sanchez Inzunza. The scammers' technique is tried and tested: redirected to a perfect imitation of their bank's website, via an advertisement, email or text message, the victim is prompted to enter personal information that will enable their money to be stolen.

Dromomanos, which had to launch a fund-raising campaign after this mishap, has since been waging a legal battle to obtain a refund while, simultaneously, investigating online scams: "The magnitude of the problem was made clear to us after the amount of personal testimonies that we received during the campaign. It seems that bank employees are often involved in fraud. This is certainly linked to their low salaries, and there is probably also a structural problem linked to the way that banks operate in Latin America," said Sanchez Inzunza.

Economist Oscar Ugarteche Galarza has also investigated these practices. He and four of his colleagues at the National Autonomous University of Mexico (UNAM) were victims of bank fraud: each had €27,000 taken from their account. "We were reimbursed because the university intervened, but in most cases, the bank washes its hands of the matter. It's all the more scandalous that the bank is reimbursed by its insurance but doesn't pass the money on to its customers."

It's the Wild West

Several banks based in Mexico have their headquarters in Europe (BBVA, Santander, HSBC, etc.) and do not follow the same rules on different continents. "Mexico is the Wild West, with no regulations to protect consumers and very little knowledge about cybercriminals," said Ugarteche. Nationwide, the problem of online scams is only growing: according to recent data from the Mexican Secretariat for Home Affairs, complaints increased by 40% between 2020 and 2022. "And it's important to note that most victims don't file a complaint, as is often the case in Mexico," said Aguirre.

If it seems easy to fool Mexicans, it must also be acknowledged that their banks subject them to constant marketing. "It's not normal how banks call their customers in Mexico so regularly, sometimes several times a day, to offer them new products incessantly. Because when the call is a fraud, it's hard for the customer to tell. The first step would therefore be to regulate telephone marketing," said César Duarte, a researcher at the School of Economics at UNAM and a specialist in finance.

Sixteen bills to counter fraud and better supervise banking obligations have been submitted during this term – but none of them have been put to a vote. According to a majority MP, speaking on condition of anonymity, a certain "bank lobby" is active in the corridors of Parliament and is no stranger to the fact that the file is always put back at the bottom of the pile...

https://www.lemonde.fr/en/international/article/2023/11/09/mexico-is-online-scammers-favorite-playground_6239268_4.html

We've lived here since 2008; bought and remodeled two houses, bought a new car here, buy lots of tickets on MXN airlines, had 4 surgeries at HSA and never needed (nor wanted) a MXN bank account.

I have had a Bancomer/BBVA account for about 18 years. I have never received a phone call from them nor any emails, aside from the security ones notifying me that there was a bank transfer made and if it wasn't me who did it, to contact them.

As far as people getting phishing emails with links leading them to fake look-alike sites, or asking them for personal info, that is just a hazard of the internet- there are tons of scammers in any arena, not just banks. If people don't know not to click on unknown links or give out their personal info online unless they are on the secure website of whatever entity they are dealing with, then they probably better off not using the internet.

We have a couple of Mexican bank accounts for business purposes but otherwise would never put or keep a large amount of money in any Mexican bank. There are countless stories of bank employee theft and fraud with few legal repercussions for the thieves and no settlements for the victims.

A few months ago I filled up my gas tank at my nearby gas station and then drove to the airport on my way to GDL. The following day I get a text from my credit union asking about a hundred dollar charge. I denied it, and they cancelled the charge and the debit card. Not having a debit card, used Xe to transfer funds from my credit union to a relative’s bank account. I got a very good exchange rate and a charge if 2.99dls.

CanuckBob wrote:We have a couple of Mexican bank accounts for business purposes but otherwise would never put or keep a large amount of money in any Mexican bank.

Same here. I need a Mx. bank account for my upholstery business- clients often transfer $ for materials and I in turn transfer to purchase the Sunbrella fabric from the fabric company I order from. But money goes in and out quite quickly- I try not to let a large amount stay in the account for long.

And I also use xetrade to transfer from my Canadian bank acct. to my Mexican acct. if I need a larger amount for some house project or car repair than what I can withdraw at the ATM.

Yes, things are certainly easier now a days. I have the ability (with Scotia) to do wire transfers online to any bank account in the world for $1.99. Gone are the days when you had to attend in person to do wire transfers.

[quote="BisbeeGal"]We've lived here since 2008; bought and remodeled two houses, bought a new car here, buy lots of tickets on MXN airlines, had 4 surgeries at HSA and never needed (nor wanted) a MXN bank account.  




Same here. Nineteen years now and doing fine. Every now and then I run into something that makes me think life might be easier with a Mexican bank account.....but I soon get over it.

CanuckBob wrote:I have the ability (with Scotia) to do wire transfers online to any bank account in the world for $1.99.

I do EFT transfers through xe. I don't know what others' experience is, but a client once did a wire transfer from their NOB bank to my Mexican account, and because it came in as US dollars, the Mexican bank charged me 200 pesos "conversion fee" in addition to using their own exchange rate, which wasn't good. Whereas using on online currency exchange house, like xe or Wise, the money arrives in pesos, therefore there are no currency exchanges by the Mx. bank.

With Scotia the exchange rate and actual amount you will receive is shown before you hit the send button.

Yes, that is how it works with xe, etc, too. I think you are saying that Scotia converts the $ and it gets transferred in pesos?
What I was referring to is when a client wired money from their US bank account, and it was wired in dollars, so BBVA did the conversion and charged an extra 200 peso fee for doing it.

Yes, Scotia does the conversion.