UPDATED: July 27, 2021

Maybe you like to do things old school and write checks or even pay cash for stuff. But sometimes sticking to traditional ways isn’t fast enough or not possible at all. And particularly now, it can pose special problems when you can’t get to the bank or other outlets where you might be able to arrange cash transfers, and you can’t see friends and family in person.

You do know that you can send money online, to individuals and businesses local as well as foreign, but you’re afraid that it’s not safe.

Well, here are some facts to reassure you that sending money directly from your phone or laptop is not only secure, but it’s so convenient that you may never again want to do it any other way:

What Is The Electronic Fund Transfer Act?

EFTA, also known as Regulation E, is federal law, passed by Congress in 1978, that established rules to protect consumers and defined the rights and responsibilities of all participants involved in transferring funds electronically. Covered transactions include those at ATMs, point-of-sale (POS) terminals as you’d find at stores, automated clearinghouse (ACH) systems that transfer funds between banks such as when your salary is direct-deposited, telephone bill payment plans, debit card transactions, remote banking programs, and remittance transfers. 

How Does The EFTA Protect Me? 

It gives you the same protections you have when paying by check. You may challenge errors and have them corrected, and you have limited liability on lost and stolen debit cards. The EFTA also requires financial institutions and any third party involved in electronic fund transfer services to disclose to you a summary of your rights, a summary of the types of transfers you can make along with any fees and limitations associated with them, a summary of liability regarding unauthorized transactions and transfers, a summary of the institution’s liability to you if it fails to make or stop authorized transactions, the circumstances under which the institution will share your account and account activities with third parties, and procedural information on how to put in claims in the event of errors or unauthorized transactions. 

So What Could Go Wrong?

If you don’t use caution and a bucket of common sense in deciding who you’re going to send money to, a lot could go wrong. It won’t be the money transfer service’s fault. It will be yours. So pay attention to these fraudulent schemes and don’t fall for them:

Emergency Scams

Typically targeting grandparents, criminals will call and impersonate their grandchildren, saying they are in terrible straits and need money right away. Even if you truly believe it’s your grandchild, ask questions that only he or she can answer and verify with an independent third party before you send any money at all.

Online Dating Scams

Criminal annals are full of stories about [mostly] women who are duped by men into fake romantic relationships and then asked to send increasing amounts of money to help them through some crisis. It’s hard to resist when emotions are involved, and hard to admit you’ve been scammed, but hang tough and cut this person off immediately.

Lottery, Prize and Inheritance Scams

No legitimate organization will call and ask you to send money to cover processing fees or taxes in order to claim prize or lottery winnings or a windfall inheritance. Don’t fall for the alternative to this scam, either, where you’re sent an unsolicited check or money order and instructed to deposit it and immediately send a portion back to cover fees or taxes. The check you’ve received won’t clear, and you’ll be out the funds you transferred back.

Employment Scams

You are being scammed if you are asked to send funds to cover recruitment or start-up fees or if you’re sent a check in advance of starting work and told to remit a portion back to cover those fees. You’ll be out of money and still won’t have a job.

There is any number of similar frauds out there, and they’re getting more and more clever, so you’ve really got to keep your wits about you. Very often, others who have been tricked in the same ways document their experiences on websites you can search

How Else Can I Protect Myself?

Never send money to someone you have never met in person or know to be legitimate. Never disclose your banking information to people or businesses you don’t know. If you think you’ve been victimized by a fraud, contact the service you used and report the crime to authorities.