Swipe Right on Suspicion: Jersey Banks' Battle Against AI-Powered Romance Rip-Offs

The JFSC has reminded the Jersey public about Romance fraud.

• Romance fraud is one of the fastest-growing forms of financial crime, and it’s becoming more sophisticated. Scammers are using AI-generated profiles, stolen identities and encrypted messaging apps to create convincing, long-term relationships before exploiting trust for financial gain. It affects people of all ages and genders.
• https://www.linkedin.com/posts/jersey-financial-services-commission_romance-fraud-is-one-of-the-fastest-growing-activity-7427348782524190720-6t3x?utm_source=share&utm_medium=member_desktop&rcm=ACoAAAA_6EIB0wPAWyjQcuq_XiD3asUV8xpMeZ0

LET’S ALSO REMIND THE BANKS AND OTHER FINANCIAL INSTITUTIONS OF THE RISK

• Banks and other financial institutions can unwittingly facilitate these crimes through transfers or transactions involving proceeds of fraud. Under the Proceeds of Crime (Jersey) Law 1999, financial services businesses including banks have strict obligations to prevent and detect money laundering. This includes:-
• Establishing procedures under Article 37 for identification,
• Monitoring (including real-time),
• Trigger events,
• Tipping off.
• Internal and external reporting
• Staff training.
• Record-keeping,
• Article 34D specifically requires
• prompt disclosure to the Financial Intelligence Unit (FIU) or a nominated officer (such as a Money Laundering Reporting Officer)
• if there is knowledge, suspicion, or reasonable grounds to suspect that a transaction involves money laundering or property derived from criminal conduct, such as fraud.
• Failure to report is a criminal offence punishable by up to 5 years' imprisonment, a fine, or both.
• Reporting must be done in good faith and as soon as practicable, with protections against confidentiality breaches for such disclosures.

BANK COMPLIANCE OFFICERS SHOULD BE REMINDED OF THE THREE KEY STEPS TO FULFILL THEIR OBLIGATIONS AND COMBAT ROMANCE FRAUD:

• Monitor: scrutinise transactions for red flags like unusual patterns, rushed requests, mismatched beneficiary details, or links to high-risk jurisdictions
• Challenge: verify customer instructions, conduct enhanced due diligence on suspicious activities, and question inconsistencies before processing transfers
• Report:  file a Suspicious Activity Report (SAR) promptly to the dedicated MLRO and DMLRO, who will handle internal escalations and determine whether to report to the Jersey FIU

Key Web Sources:

• Proceeds of Crime (Jersey) Law 1999: https://www.jerseylaw.je/laws/current/l_8_1999
• Official Consolidated Version (PDF): https://www.jerseylaw.je/laws/current/PDFs/L_8_1999_20250701.pdf
• Jersey Financial Services Commission Handbook on Reporting Money Laundering and Terrorism Financing:  https://www.jerseyfsc.org/media/wslgyk4t/section-8-clean-22012026.pdf
• Financial Intelligence Unit - Jersey: https://www.fiu.je/
• PolSAR Portal for SAR Submission: https://services.jersey.police.uk/PolSAR/Login.aspx
• States of Jersey Police: https://www.jersey.police.je/
• https://www.comsuregroup.com/news/iom-fiu-fraud-by-false-representation-in-banking-a-typology/