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Fake Check Scams

Gone are the days of direct barter where individuals, integrity intact, would sit across from one another and mutually agree upon a fair price to exchange for products or services. Crucial here was the ability of both parties to assess each other’s character. Then, one’s word was a bond, or the deal was off.

In the Information Age, where the Internet has all but removed the need for traditional barter, men and women no longer need to face each other to complete a transaction. This has proven to be a fertile environment for would be criminals to groom a craft; they’ve learned to transform hard-working, though vulnerable, individuals into victims.  The scammer, money in hand, is free to prey on others.

It usually starts the same way, a stranger offers to pay for a product with a genuine check.  It’s normal business on the surface, but there is always a catch that leaves the seller responsible for passing the fraudulent check. Fake check fraud has evolved into a highly sophisticated criminal enterprise. This fraud would not be so successful, however, if victims had been cognizant of a simple fact: if a stranger wants to pay by check,  but wants the payee to wire a portion of the money back, it’s a scam!

To not become a victim, beware these common traps:

  • Don’t agree to accept payment by check that is for more than the selling price.  Don’t agree to cash a check and wire or give part of the money back.
  • Don’t accept a stranger’s check in payment for work or goods, unless it is from a legitimate business or organization.
  • Don’t accept a check purporting to be an “advance” on a sweepstakes.
  • Don’t agree to accept a paid installment on possible millions for supposedly transferring money from a foreign country to a personal bank account for security purposes.

These may seem ridiculous, but scammers can sound quite convincing and people have fallen for these scams.  Here are some tips the National Consumers League (NCL) offers to help recognize fake check scams.  

There are many variations of the fake check scam (see list above). Fake check scammers hunt for victims. They are known to check newspapers and online ads; they even check online job postings to see who is looking for employment. They often claim to be in another country. They tell victims to wire money to them after the scam check is deposited. Scammers often say they can’t pay directly, but will have someone who owes them money send a check. There is no legitimate reason for someone who is giving you money to ask you to wire money back. If a stranger wants to pay you for something, insist on a cashiers check for the exact amount, preferably from a local bank or a bank that has a branch in your area. (Source: NCL, 2007)

It is crucial to realize that these scammers transfer all of the resulting charges and legal fees directly to their victims, and then move on.  Their checks may look real, even fooling bank tellers, but they are not.

Federal law stipulates that banks must make funds available within one to five business days, so money can often be withdrawn rather quickly, but this does not mean you are in the clear. It could take months before the forgery is discovered. Once it has, the bank will come looking for you to make good on the money, possibly incurring fraud charges by local law enforcement authorities.

It is a lose-lose situation for the victim, and you never want to lose when you don’t have to!

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