Get expert advice delivered straight to your inbox.

Skip to Main Content

What Is Wire Fraud?

Phishing? Fake antivirus software? “You’ve won” scams? It’s hard to keep up with the latest internet and telecom fraud schemes that thieves use to try and steal your hard-earned money.

But the more you know, the better you can protect yourself. So, let’s dig into the latest scams, warning signs, penalties, and—most importantly—steps you can take to protect yourself.

  1. What Is Wire Fraud?
  2. A Brief History of Wire Fraud
  3. Examples of Wire Fraud
  4. Wire Fraud Penalty



What's your risk of identity theft?

Take this quiz to assess your risk.

1. What Is Wire Fraud?

Wire fraud is when someone uses telecommunications or the internet to con someone. It can be a phone call, a fax, an email, a text, radio, television, social media messaging, or any other form of airwave or cable communication. That includes wireless communications too!

Try 30 days of identity theft protection free from our RamseyTrusted provider.

Okay, that explains the wire part. But what about the fraud part?

Well, fraud covers a wide range of scams thieves use to trick you—usually to get your money. Fraud can be committed by a single person or even an entire company and is punishable by prison time and/or fines. It could be anything from cheating a grandmother into emptying her savings account to stealing millions of dollars from a group of investors.

2. A Brief History of Wire Fraud

Ready for a short trip down memory lane? Here we go . . .

It used to be that communications fraud was restricted to the telephone and postal mail. Fraudsters would make hundreds of phone calls or send out hundreds of postcards to hook gullible targets.

Those scammy phone calls and postcards haven’t really gone away, but when the internet was born, it provided all new ways for thieves to trick people out of their money. Now a fraudster’s work can be done entirely online with a few fake photos, made-up stories, or promises of eternal financial security.

3. Examples of Wire Fraud

Here are some typical scenarios of wire fraud—be on the lookout for scams just like these.

Nigerian Prince Scam

Let’s start with one of the longest-running examples. The original Nigerian Prince scam (aka the Nigerian letter scam and the 419 fraud) is a centuries-old swindle that’s been around since the French Revolution. These old-school scammers sent handwritten letters asking for financial help for a nonexistent nobleman who was falsely imprisoned.

The original story might be long forgotten, but the heart of the scam lives on. Today’s fraudsters use emails, websites and Facebook profiles—instead of handwritten postcards—to convince trusting people to wire them money or send them their personal information. Nigerian prince scams still rake in over $700,000 a year.1

Pro tip: Never—and we mean never, ever, ever—send money or give out your personal information to strangers, no matter how convincing they are.

Phone Swindles

Since it’s easier to rip people off when you’re not face-to-face, a lot of scammers still rely on the good ol’ landline (or cell phone) to find their victims. Sadly, it’s mostly elderly people who fall prey to phone swindles. Why? Because many senior citizens aren’t savvy to the latest scams.

The con usually goes something like this: Suppose an elderly woman named Donna gets a phone call from someone claiming to be a member of the local police department. The caller tells Donna her grandson has been arrested and she needs to send $10,000 to bail him out of jail. Without hesitating, Donna drives to her bank and asks the teller to wire $10,000 from her savings account to the number the con man gave her.

Pro tip: Always double-check the information strangers on the phone tell you. In this case, if Donna had called her grandson before driving to the bank, she wouldn’t have lost $10,000.

Phishing Scams

Phishing is another type of wire fraud where a scammer lies—usually through email—to get someone’s personal financial information to either steal from them or sell their information to other scammers.

Here’s an example—this one’s called brand impersonation.

Imagine someone sends you an email pretending they’re a UPS delivery driver. They tell you someone is trying to send you a package, but they need your address and credit card number to complete the delivery.

Is this a scam? Most likely, yes. Think about it. If someone sends you a package, wouldn’t they already have your address? And the even bigger red flag: Why would the sender need your credit card number?

Pro tip: Never respond to suspicious emails. If you don’t know the sender, the sender’s email address isn’t from the company they say they’re from, or the email content has spelling and/or grammar mistakes, it’s probably a scam.

You Won a Prize!

This type of wire fraud is called “you’ve won” scams. It’s really hard to resist—who doesn’t want to win something?

“You’ve won” scams usually follow the same pattern: You get a card in the mail, or a phone call, or an email saying you won something big. Maybe the scammer did their homework before they contacted you and found out you’ve always wanted to go to Italy. Or maybe they say you won a lottery or a sweepstakes.

Whatever the prize, you get super excited! But here’s what happens next: The scammer claims you need to give them your credit card number or bank information so they can send you your prize. You fall for it and a few days later you check your bank account, and instead of finding the cash prize you expected, you find a huge chunk of your money is gone!

Pro tip: Put the brakes on your excitement about winning a prize and pay attention to the details. You can’t win a contest you never entered. And remember the most important rule: Never give your credit card or banking information to anyone you don’t recognize. Ever! Even if they claim it’s your lucky day.

Interested in learning more about identity theft?

Sign up to receive helpful guidance and tools.

By submitting this form you are agreeing to the Ramsey Solutions Terms of Use and Privacy Policy.

4. Wire Fraud Penalty

Is wire fraud a federal crime? Yes, the feds take wire fraud very seriously.

The reason wire fraud is a federal crime in the United States is because it often crosses state lines. That means it can be investigated by the FBI or the Federal Trade Commission (FTC).

Punishment for online scamming is harsh. We’re talking up to 20 years in prison and $250,000 in financial penalties for individuals. Plus, each act of wire fraud can be charged as a separate offense. So, if a single scammer sends fake emails to 15 different people, they could be fined a whopping $3.75 million (15 x $250,000).


If you spot a wire fraud scam, you can report it by calling the Federal Trade Commission at 1-877-382-4357 or going online:

Don’t Become a Victim of Wire Fraud

What’s the best way to protect yourself against online scammers? We recommend working with RamseyTrusted provider Zander Insurance. They monitor your personal info in real time—so if something looks suspicious, they’ll let you know immediately. And if the worst happens, and your identity or money is stolen, they’ll stay with you every step of the way to make sure your world is right-side-up again.

Get protection today!


Get IDT for your entire family for 12 dollars and 90 cents per month or 145 dollars per year.Get IDT for 6 dollars and 75 cents per month or 75 dollars per year.

Did you find this article helpful? Share it!

Ramsey Solutions

About the author


Ramsey Solutions has been committed to helping people regain control of their money, build wealth, grow their leadership skills, and enhance their lives through personal development since 1992. Millions of people have used our financial advice through 22 books (including 12 national bestsellers) published by Ramsey Press, as well as two syndicated radio shows and 10 podcasts, which have over 17 million weekly listeners. Learn More.

Related Articles

types of fraud

9 Common Types of Fraud

Don't just assume you're not at risk—you are. Keep you and your family safe by looking out for these scams.

George Kamel George Kamel
Rachel Cruze holding a piggy bank talking about financial security

5 Proven Ways To Achieve Financial Security

Financial security isn’t just a dream that only certain people achieve. It’s for everyone—that includes you! Here are five ways to achieve financial security (and become financially stable).

Rachel Cruze Rachel Cruze