Protect Your Cash From Fake Check Scams

5 common tricks used by fake check scammers: Internet Scambusters #773

Bankers say that fake checks are one of the biggest sources of consumer fraud today.

Even though legitimate check usage is on the decline, forgery scams are not.

In this week’s issue, we’ll tell you the five most common sources of fake checks and how to avoid them.

Before we begin, you may want to spend a moment looking at this week’s most popular articles from our other sites:

Identity Theft and Your Social Security Number: If your Social Security card gets stolen or you are a victim of identity theft, here’s what you should do.

Save Energy the Smart Way — Don’t Fall for These Myths: Check out these myths about energy consumption before you start on your energy-saving campaign.

Saving Money on Groceries Made Easy: These tips will help you save money on groceries so you can slice your supermarket total, if not in half, then by a significant amount.

Cheap Household Cleansers You Might Try: You can really save some cash with cleaning supplies if you’re willing to consider these cheap household cleansers instead.

Now, here we go…


Protect Your Cash From Fake Check Scams


Could you spot a fake check scam?

You might think you’re smart enough, but every year thousands of people — maybe tens or even hundreds of thousands — pay the price of believing a phony check they received is genuine.

The fact is that modern computer and printing technology make it reasonably easy to produce authentic-looking checks that not even an expert could identify without making further inquiries.

In fact, according to the American Bankers Association, fake checks are one of the biggest causes of consumer fraud today.

“Scam artists are using sophisticated technology to create counterfeit checks that mirror the appearance of legitimate checks,” they warn.

“Some are counterfeit money orders, some are phony cashier’s checks and others look like they are from legitimate business accounts. The companies whose names appear may be real, but someone has dummied up the checks without their knowledge.”

There are five major targets for this type of fraud.

1. Overpayment Scams

This is probably the most widespread check scam, sometimes also referred to as an advance payment scam.

Crooks send out dud checks to victims, asking them to wire part of the money supposedly to a third party. The hope is the victim will bank the check and wire the money before the fake is discovered.

They use all types of creative stories to convince their victims that they’re genuine, most notably for employment scams.

For example:

* Pretending the money is for a secret shopper program where the victim is supposed to test a store’s money-wiring services.

* Other work-from-home schemes, where part of the money has to be wired for supplies or training materials.

* Supposedly hiring someone as a tutor or caregiver and then asking the victim to forward the money to buy special equipment that’s needed.

Scammers also target small firms, placing orders and then requesting them to forward part of the money to a “shipper.”

In virtually all cases, these scams involve wiring money, the final destination for which is untraceable.

As we never tire of warning: Don’t wire money to people you don’t know!

2. Payment for Purchase

In the old days, when someone bought something from you and paid by check, you could usually trust them to be the genuine article — but no longer.

You advertise something for sale, say on Craigslist or a community noticeboard, and someone turns up to buy it, with a check or cashier’s order.

You simply can’t tell from looking at that piece of paper whether it’s real or not. But if it’s not drawn on a local bank, you should be suspicious.

Either way, you can phone the bank to check if it’s legit. Or you can take steps to check the buyer’s ID, such as seeing their driver’s license.

Better yet, state in your ad that you’ll only accept cash. However, if it’s for a large sum, you’ll need to know how to check if the notes are genuine. Find the answer to this in an online search.

3. A First Installment

This a sort of advance fee scam used to try to convince people they won a lottery — or even inherited money from a Nigerian prince.

Victims receive the check, usually by courier, with an urgent message that they need to pay out of their own funds for their winnings or inheritance to be released.

Once more, the money has to be wired — but you should never, ever pay money to collect supposed winnings. Follow that rule and you’ll never be scammed in this trick.

4. Bank Account Access

Students and other people who are financially hard-pressed have been known to sell their bank account details to scammers or otherwise to permit their account to be used to “process payments.”

Sometimes, they’re even persuaded to hand over their ATM card and claim it was lost or stolen.

The scammers use the account to deposit fake checks, sometimes using smartphone apps, and then immediately withdraw the cash.

This may sound crazy but people have been caught doing this. They not only end up owing all of the missing money to the bank but run the risk of being labelled an accomplice and appearing in court.

5. A Friendly Cashier

It used to be if you needed cash in a hurry you could ask a friend or a local convenience store to cash a check for you.

But today, if you’re the one handing over the cash, you could find yourself the loser — if the check bounces or is fake.

You may have friends you can trust, but if someone turns up at your front door claiming they just moved into the neighborhood, or turns up at your front desk or register claiming to be from a business just down the road, beware!

These days, the legitimate use of checks is declining but, sadly, fake checks are on the rise, so watch out.

Alert of the Week

Robocalls — don’t you just hate those automated phone calls saying you’ve been selected for some kind of special offer, or even a prize?

News magazine Time warns that 95% of Americans got one of these calls in just the first six months of this year.

Although crooks can spoof a call, pretending it comes from another source, the best way of avoiding robocalls is still to refuse to pick up the phone if you don’t recognize the number. If it’s a genuine call, they’ll leave a message.

That’s all for today — we’ll see you next week.