Romance fraud, or a romance scam, is a confidence trick where a criminal establishes a fake online presence to gain the victim’s love and trust. The fraudster then uses this romantic, personal connection to manipulate and exploit the victim into giving them money.

While romance fraud can actually take on many different forms, one thing makes them all the same: fraudsters fake a romantic relationship or intimate friendship for financial gain.

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In the most basic sense, romance fraud can be summarized in the following steps:

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1. The fraudster connects with their victims under the guise of a romantic relationship, typically using a fake identity.
2. The fraudster develops a personal relationship with the victim, often preying on the victim’s deepest desires, insecurities, and weaknesses.
3. Once some form of trust and intimacy has been formed, the fraudster requests money or other valuables from the victim.

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While not necessarily required, most fraudsters use false identities to conduct this type of fraud, using fake images and personas to lure their victims into the ‘relationship.’ Fraudsters also seldom meet their victims in person (or even via video chat) in an effort to hide their true identity. 

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Since most romance scammers use fake images, they cannot reveal their true identity to their victims without being found out. Instead, these criminals lead the victim on, telling them that they will meet them in the future. They often use a variety of excuses to ensure they never have to meet up, video call or otherwise see the victim.

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These schemes can be very quick, with fraudsters finding a victim, exploiting them, and then disappearing. These scams can also be long-running, sometimes spanning years. 

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The fraudster will lead the victim on for as long as they can without being caught, exploiting them for money and other assets along the way. While most people commonly picture the fraudster simply tricking the victim into sending them money, scammers will also blackmail victims into sending them valuables.

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Many times, money isn’t outright requested. Instead, criminals claim they require money for plane tickets to visit the victims, a passport to be able to travel, and other similar travel expenses. The fraudster never actually books this travel, instead pocketing the money. They come up with an excuse as to why they can’t make the trip, sometimes even going as far as claiming they made the trip but got stuck due to customs or immigration issues.

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Either way, the fraudster never had any intention of visiting the victim - or pursuing a real romantic relationship. Instead, they exploit the victim’s goodwill and feelings to steal money and valuables.

Although all romance fraud involves fraudsters that exploit intimate relationships for gain, these scams can be conducted in various ways. Below, we cover some of the most well-known variations of romance scams.

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Love Bombing

In love bombing romance scams, fraudsters bombard their victim with uplifting messages, and expressions of unconditional love, and make the victim feel important and admired. The fraudster earns the victim’s attention, uplifting the victim and solidifying their relationship with the victim. This often creates a dependency for the victim, who seeks validation, support, and admiration from the fraudster - whom they believe to be a true romantic partner.

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After building this relationship up and gaining the victim’s trust, the fraudster manipulates the victim into sending them money, valuables, or personal details that can be exploited later.

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Blackmail

In blackmail romance scams, fraudsters leverage private information about the victim to blackmail them into sending them funds.

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This can be done by leveraging personal information, divulging their relationship with the victim to another person, or by simply threatening to share private information they’ve exchanged publicly. 

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In many cases, fraudsters will entice the victim to send nude images, which they then threaten to share as a way of embarrassing or disgracing the victim, hoping the victim will pay a ransom to ensure their images, messages, or other exchanges are kept private.

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Pro-daters

An elaborate version of the romance scam, pro-dating involves fraudsters that pretend to be on a legitimate date with the victim, but in reality, the entire date is an elaborate ruse to exploit the victim for cash. Pro-daters do just that, go on dates with the victims, with the victim footing the bill.

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Pro-daters typically set up dates with wealthy suitors outside their country. In this type of scam, the fraudster will invite their victim over to their country and meet them in person, but only to dupe the victim into spending large amounts of money in a short period of time. 

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This method often involves collaborators, like a translator, tour guide, or driver, who the victim is compelled to compensate at a higher rate than usual. The fraudster takes charge of planning the victim’s trip and itinerary so that the victim pays for expensive hotels, restaurants, and tourist sites, and is deceived into making numerous high-value purchases such as presents or necessities.

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The fraudster accomplices receive exorbitant tips from the victim, which they later share with the pro-dater.

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Intimate Activity

Really, this is a more specific case of blackmail romance fraud. Fraudsters engage in intimate activity with the victim online, via video calls, images, and personal messages.

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After the fraudster has earned the victim’s trust, they will request a video call or intimate images from the victim. The fraudster will find an excuse as to why they can’t participate (i.e. their webcam or phone camera is broken). They then convince the victim to partially undress or perform intimate acts.

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The fraudster then reveals their true identity, and claims they’ve recorded the entire interaction or saved the private images. They then blackmail the victim into sending them money and valuables, threatening to share the video with common acquaintances, their social network, or publicly online.

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Inheritance

In inheritance romance scams, fraudsters convince the victim (whom they’ve developed a romantic relationship with) that they will receive a large inheritance. They then convince the victim that to receive the inheritance, they need to pay unexpected expenses that they can’t currently afford.

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In some cases, they will even claim that they need to be married to inherit the money, which comes with a series of additional expenses that need to be paid before they can claim the inheritance. 

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Either way, the fraudster holds the idea of future wealth over the victim, demanding money to make that possible. It’s either stated or heavily implied that the victim - who believes they are in a romantic relationship with the fraudster - will be in a long-term relationship with the fraudster, and benefit from this inheritance with them.

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The victim is eventually asked to pay associated costs, whether that’s plane flights, customs or import taxes on the inheritance, or other falsified expenses. The fraudster makes off with whatever the victim pays them, and never actually meets them in person.

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Military Impersonation

Military impersonation is a common tactic fraudsters use in romance scams. With military personnel being stationed overseas, it creates a justifiable reason for international transfers, which fraudsters exploit.

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As with a typical romance scam, the fraudster develops a relationship with their victims, later exploiting them with cash. In this version, however, the fraudster impersonates military personnel. When perpetrating military romance scams, fraudsters sometimes exploit the identity of a real soldier or create a completely new fake identity, stealing images and information from public databases on military members.

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After developing a relationship with the victim, fraudsters will claim that they can’t access funds because they are in a combat zone or simply claim they need financial assistance. In reality, the fraudster falsifies their identity to exploit the victim out of money.

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Code Verification

In most of the types of romance scams we’ve covered, the fraudster directly requests money or valuables from the victim; but that isn’t the only way romance fraudsters can exploit their victims.

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In the code verification type of romance scheme, victims don’t actually directly request money from their victims, instead using their romantic relationship to collect personal information on the victim. This information can later be used to access the victim’s accounts, create fake identities, and other nefarious activities.

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The fraudster (being in a fake romantic relationship with the victim) knows which dating apps, social media platforms, and other services the victim uses. They leverage this information to send fake code verification messages to the victim through email or text, pretending to be a dating app or social media service that the victim uses. When the victim clicks the link, they are requested to input personal details (such as passwords, security questions, and more), which the fraudster collects on the other end.

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Malware

In this version of a romance scam, fraudsters serve the victim with malware - either directly or by funneling them to a third-party site, which they also secretly operate.

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The malware will either stay dormant on the victim’s device (collecting personal information for the fraudster) or be used to lock the user out of their device(s) entirely. In the first example, the fraudster will continue to collect personal information over time, using this information to take over accounts or create fake identities with the information. In the second example, the fraudster extorts the victim for money in order to regain access to their device(s).

Unfortunately, romance fraud scams are often conducted using private communication channels and the scammers themselves are adept at tricking victims.This makes it increasingly difficult to detect, even for the dating apps where this type of fraud often begins, as fraudsters quickly take their conversations off-channel.

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As a financial institution, it can be very difficult to detect romance fraud schemes in action. Below, we cover the top things FIs should look for when trying to identify romance scams.

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• International transactions: If a user abruptly starts making consistent international payments, this could be a red flag that they are a victim of romance fraud, especially if they have no previous history of international transactions or transfers.
• Transactions that fall outside of standard use: When users start a new account, they often indicate the purpose of their business with the financial institution. If the account activity doesn’t match the intended use of the account, this could be a red flag of either a fraudster or a victim.
• New accounts with mostly incoming money: If new accounts are being created that mostly receive money, rather than transferring, withdrawing, or engaging in typical transactions, it’s a red flag they could be a romance fraud scammer.
• Abnormal transaction patterns: If a user makes radical changes to their regular spending habits or transaction patterns, this could be a red flag they are a victim of a romance scheme. This includes not only high-value or high-volume spending, but also abnormal types of purchases, such as travel, services, or brands that don’t consist of where the user typically spends their money.

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You may have noticed that many of the methods of detecting romance fraud come down to finding victims of fraud as opposed to fraudsters. Since many fraud prevention solutions are adept at finding anomalies in transaction and user behavior, it’s often easier to spot changes in victims’ behavior than that of their attackers.

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Given the challenges FIs face in actually identifying romance fraud, it’s essential to properly train customers to protect themselves. Below, we cover the red flags individuals should look for to avoid falling victim to a romance fraud scam.

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• They request personal information: If they ask you for personally identifiable information, such as a social security number or password, they are likely trying to collect information for some type of identity theft fraud. While getting to know each other is a standard part of a new relationship, certain details should alert you to the fraudster’s ill intentions.
• They don’t divulge information about themselves: If they either outright refuse to or skirt around sharing personal information about themselves, they may try to retain their autonomy and avoid mixing up their backstory. In most cases, fraudsters shift the focus to the victim, trying to extort more information.
• They refuse to meet you in person: If they refuse - or make up excuses as to why they can’t - meet you in person, they may be falsifying their identity to you. While virtual relationships are commonplace, when someone never attends a video call or other means of ‘live’ interaction, it should raise concerns about their true identity.
• Their backstory doesn’t add up: If their stories start to contradict each other, it could be a sign that the person you’re talking to is lying, and that they aren’t who they say they are.
• The relationship advances quickly: If they try to move the relationship forward at an abnormal pace rapidly, they may be trying to strengthen and nurture the relationship quickly. The point of advancing the relationship so quickly is to speed up the process of exploiting the victim.
• They claim “it’s an emergency”: If they tell you they are in an emergency situation, they may be trying to leverage the emotional connection you have to create a sense of responsibility to help. This also builds a sense of urgency for the transfer, giving the victim little time to think through their decision.
• They ask you to use unregulated platforms: If they ask you to move your conversation off the dating app you met on to a less secure, more private communication platform, they may try to con you. Typically, fraudsters choose channels that have fewer protections and regulations than the original channel they met on, leaving the victim more vulnerable.
• They ask you to transfer money on their behalf: If they ask you to either accept, send, or transfer money on their behalf of them, and want you to perform transactions with other individuals, this may be a sign they are trying to lure you into money laundering.

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As a potential victim, it’s important to be on alert, even when using legitimate dating apps; fraudsters target these platforms specifically for their users, who are seeking romantic relationships. Keep potential warning signs in mind until you really get to know someone - and always confirm they’re a real person before sending money.

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As with most types of fraud, preventing it is limited to your ability actually to detect it happening. To help with prevention, you need to properly train customers on how to prevent themselves from falling victim to these scams in the first place.

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When onboarding users, be sure to teach them of the potential dangers of romance fraud and what they should do to avoid falling victim:

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• Be careful about sharing personal information: Don’t divulge too much information to a potential romantic interest early on, and never reveal certain types of personal information, like social security numbers.
• Be careful about what you share publicly online: Information posted online can be used to analyze your interests, hobbies, and behavior. This can all be leveraged by fraudsters to create a fake identity that would interest you romantically.
• Trust, but verify: While you can’t verify everything a romantic interest tells you, you can verify certain concrete details. As you interact, research certain details they tell you to verify you are interacting with a real person.
• Don’t send money to anyone you’ve never met: Really, any time someone asks you for money, you should approach the situation with caution. If you’ve never met the person, you should never send them money or buy them valuables.

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By keeping customers aware of their power to prevent romance fraud, FIs can drastically reduce romance fraud on their platform. Beyond this, financial institutions can do several things to detect romance fraud occurring on their service.

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Customer onboarding allows risk and compliance teams to root out romance fraud at the source, denying illegitimate and malicious users an avenue to exploit victims. As many fraudsters use new accounts and fake identities, onboarding and new account monitoring are critical tools in preventing romance scams.

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‍Transaction monitoring is another invaluable tool in the fight against romance fraud, empowering teams to detect anomalies in user behavior. This can be used to identify not only fraudsters but also victims - which enables teams to track the fraudster(s). After identifying the patterns that commonly lead to this behavior, teams can then update their alert system to detect this suspicious behavior more accurately and precisely.