In Asia, a troubling trend has emerged, as romance scams have reached their highest levels in six years, presenting a formidable obstacle for banks and financial institutions. These entities are now grappling with heightened risks of reputational harm and the looming threat of hefty fines. A report released by Moody’s in February 2025, highlighted in an article from Asian Banking and Finance, reveals that the number of individuals and organizations potentially involved in romance scams around the world surged by 14% in 2024, culminating in a staggering total of 1,193 cases—a figure unprecedented in nearly six years.
The increase in financial grooming scams, which gained momentum especially during the COVID-19 pandemic, brings to light the heightened susceptibility of people yearning for emotional connections during periods of isolation. As lockdowns were enforced across the globe, both financial and emotional exploitation of vulnerable individuals escalated alarmingly. Following a temporary decline in 2020—when new profiles linked to romance scams dropped by 29%—the situation took a dramatic turn in 2021, with a shocking 57% increase as scammers adeptly capitalized on the unique circumstances created by the pandemic.
Romance scammers frequently exploit the conventional financial system to clean the ill-gotten gains from their deceptive operations, utilizing tactics such as sextortion. This alarming trend poses not only a social dilemma but also a significant financial one, exposing institutions to greater risks of becoming unwitting participants in money laundering and other illicit enterprises.
The report underscores that the United States leads the world in the emergence of new romance scam profiles, accounting for a notable 38% of the global total. Other countries contributing significantly to this disturbing phenomenon include Nigeria at 14%, India at 12%, the United Kingdom at 11%, Malaysia at 5%, and China at another 5%. Additionally, nations such as the Philippines, Brazil, Canada, and Australia are witnessing marked increases in these scams.
Particularly concerning is the sharp rise in romance scam activities noted in Malaysia and the Philippines. In Malaysia, the number of scam-related entities skyrocketed to 64 profiles in 2024 from a mere 6 in 2023. The Philippines mirrored this alarming trend, reporting an influx of 45 new cases within the same timeframe.
As we delve into this unsettling narrative, it becomes clear that the landscape of romance scams is evolving rapidly, leaving banks and financial institutions scrambling to fortify themselves against the rising tide of deception and fraud. The emotional toll on victims is profound, revealing not just a crisis of financial security but also a deep societal issue that calls for urgent attention and action.
In recent times, a notable escalation in romance scams has captured the attention of observers, particularly in Malaysia and the Philippines. The year 2024 marked a staggering increase in scam-related profiles in Malaysia, where the numbers surged to an astonishing 64, a significant leap from the mere 6 recorded in 2023. Meanwhile, across the waters in the Philippines, a similar trend emerged; the number of new scam profiles rose dramatically to 45, a sharp contrast to the 10 that existed the previous year.
To navigate this complex landscape, Moody’s employs its global screening database, which serves as a vital resource for tracking these alarming trends. This extensive database pulls together information from various channels, including adverse news reports, sanctions lists, government watchlists, and records of politically exposed persons (PEPs). By consolidating this wealth of information, Moody’s crafts detailed ‘risk profiles’ for individuals and organizations suspected of engaging in fraudulent schemes.
As romance scams proliferate, they expose a troubling nexus between emotional exploitation and financial deceit. The ramifications of these scams are becoming increasingly severe, prompting financial institutions to sharpen their vigilance. To safeguard themselves from the dire consequences of being linked to such fraudulent activities, these institutions must continuously refine their screening and monitoring protocols. The stakes are undeniably high, and the responsibility to protect their clients and their own reputations is more pressing than ever.
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