Romance Scams: How to Prevent Heartbreak for Your Institution and Customers

Romance scams don’t just break hearts — they “break the bank.”  

In the digital age, love can blossom online. But so can deception. Romance scams are a growing threat to both individuals and financial institutions.  

Romance Scams: When fraudsters use the illusion of a romantic or close relationship to exploit victims financially. 

These scams not only shatter hearts but also erode trust in banking systems, leading to significant losses and reputational damage. For banks and credit unions, proactive prevention is key to safeguarding customers and members and minimizing institutional risk. This post explores the scope of the problem, backed by recent data, and outlines actionable strategies to combat these scams. 

The Rising Tide of Romance Scams: By the Numbers 

Romance scams typically start on social media, dating apps, or online forums, where scammers create compelling profiles to woo victims. Over time, they fabricate emergencies—medical crises, travel woes, or investment opportunities—to extract money. The emotional manipulation makes these scams particularly insidious, often targeting vulnerable groups like seniors or the recently widowed. 

Romance scams by the numbers over the last few years: 

2023 (FTC Consumer Sentinel Data Book) 

2024 (FTC + independent analyses) 

Preliminary 2025 Estimates 

Global losses continue to rise, fueled by AI-driven scam tactics like deepfake videos and highly personalized messaging, and experts warn these figures significantly underrepresent the true impact, as many victims never report due to embarrassment or fear. 

For financial institutions, the implications extend beyond customer or member losses. Banks and credit unions may face regulatory scrutiny, reimbursement claims, and damaged relationships if scams go unchecked.  

In the broader fraud landscape, total U.S. losses hit $12.5 billion in 2024 — a 25% increase from 2023 — with imposter scams (including romance) accounting for $2.95 billion. 

Strategies for Financial Institutions to Combat Romance Scams 

Frontline staff at banks and credit unions are uniquely positioned to detect and intervene. By integrating technology, training, and education, institutions can reduce risks. Here are key prevention measures: 

1. Train Staff to Spot and Intervene 

Frontline employees should be equipped to recognize red flags, such as customers wiring money for "emergencies.”  

Modern training programs that incorporate real-world, scenario-based learning can teach compassionate questioning: "Is this for someone you've met in person?" or "Can we verify the recipient?" Institutions can implement temporary holds on suspicious transactions under applicable laws with documented escalation processes. 

2. Enhance Transaction Monitoring and Fraud Detection 

Implement advanced fraud detection software to flag suspicious patterns, such as repeated small transfers escalating to large sums, unusual international wires, or cryptocurrency purchases.  

Behavioral intelligence tools can analyze deviations in customer activity, like sudden high-value sends to new beneficiaries. AI-driven solutions, including emerging federated learning for cross-institution insights, help identify scam signals in real time. For high-risk cases, institutions should have documented escalation processes and policies to temporarily pause suspicious transfers where permitted by law and internal compliance guidelines. 

3. Educate and Empower Customers 

Launch targeted awareness campaigns via apps, emails, and branches, highlighting scam tactics like requests for gift cards or crypto. Share resources on verifying identities—e.g., reverse image searches for profiles—and encourage reporting suspicious activity. Partner with platforms like social media to promote vigilance, as the vast majority of scams originate online. Tools like behavioral biometrics can add layers of security, flagging unusual login behaviors. 

4. Foster Collaboration and Reporting 

Share data with peers, regulators, and law enforcement through safe harbors to track scam networks. Utilize FinCEN's Rapid Response Program for recovering funds in cyber-enabled scams. Encourage customers to report to the FTC, FBI's IC3, or local authorities promptly. This not only aids recovery but also informs broader prevention efforts. 

Tips for Consumers: Staying Safe in the Search for Love 

While institutions play a vital role, customers must remain vigilant: