News Details
2025.07.31
Key Risks and Countermeasures for International Wire Transfers Today
1. Introduction
• U.S. Department of the Treasury, Office of Foreign Assets Control (OFAC):
In recent years, fraud targeting international wire transfers has been on the rise.
Common schemes include requests for “urgent payments” or “invoice bank account changes,” which at first glance appear legitimate. Unfortunately, there have been numerous cases where companies unknowingly transferred funds to fraudulent accounts posing as long-standing business partners.
In addition, U.S. dollar-denominated transfers often fall under the jurisdiction of the U.S. Office of Foreign Assets Control (OFAC). Failure to properly screen for sanctions risks can result in blocked or frozen funds.
In this newsletter, we summarize key points and countermeasures to keep in mind when making international wire transfers, including lessons learned from actual cases.
2. Emerging Risks – How Do They Work?
Invoice Replacement Fraud
• Fraudsters impersonate business partners and provide new bank account details.
• They often stress urgency or confidentiality (e.g., “urgent,” “strictly confidential”) to pressure fast payment.
• Compromised or spoofed emails (e.g., using visually similar domains like replacing “l” with “i”) are commonly used.
→ Even with long-standing partners, you cannot let your guard down.
OFAC-Related Transfer Blocks
• USD transfers pass through U.S. banks and are screened against OFAC’s sanctions lists.
• If recipients or related entities are on the Specially Designated Nationals (SDN) list, the transfer may be blocked, leaving the funds inaccessible.
Stricter Bank Reviews
• As part of global anti-money laundering (AML) measures, banks increasingly request supporting documents such as contracts and invoices.
• Inadequate explanations may cause significant delays or even returned transfers.
3. Key Points to Verify Before Transferring
Before executing an international transfer, carefully check:
• Whether the beneficiary account matches previous transactions.
• Whether you are being instructed to use a different account than the one listed on the invoice.
• Whether the account change request includes suspicious explanations.
• Whether the payment request emphasizes urgency or secrecy.
• Whether the sender’s email address is legitimate (watch for subtle domain misspellings).
• For USD transfers, whether the recipient or related entities are listed on OFAC sanctions lists.
• Whether withholding tax obligations or tax treaty applications apply to the transfer.
If anything feels suspicious, always call the registered contact directly (never use the phone number listed in the suspicious email).
4. Real-World Examples
*Case A (Manufacturer in Japan): A company transferred tens of millions of yen to an account after receiving what appeared to be a legitimate email from a long-standing business partner. Later, it was discovered that the email account had been compromised.
*Case B (Trading Company): A USD transfer was blocked by an intermediary U.S. bank because the ultimate beneficiary was connected to a sanctioned entity in a third country.
5. What You Should Do Now
• Implement a multi-person verification process for all wire transfers (avoid one-person approval).
• Verify account changes by calling pre-registered contacts, not those in the email.
• Regularly check OFAC and other international sanctions lists.
• Prepare documentation for banks in advance (contracts, invoices, purpose of transfer).
• Confirm tax implications, including withholding tax obligations and the need for tax treaty filings.
6. Conclusion
The risks surrounding international wire transfers are becoming increasingly complex.
The mindset of “We’ve never had a problem before, so we’re fine” can be the most dangerous assumption.
At ARK Outsourcing, we provide comprehensive support for international wire transfers, including operational handling, OFAC sanctions screening, communication with banks, and tax compliance checks.
If you have any questions regarding international transfers or risk management, please do not hesitate to contact us.
▶ Contact Us Here Contact Us | ARK Outsourcing KK
References
• Financial Services Agency, Japan:
「マネー・ローンダリング等及び金融犯罪対策の取組と課題（2025年６月）」の公表について：金融庁 (Accessed July 25, 2025)
• National Tax Agency of Japan:
No.2801 司法書士等に支払う報酬・料金｜国税庁 （Accessed July 25, 2025)
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