Fake Check Scams

The National Consumers League reports that fake check scams now rank as one of the top most common Internet fraud scams. Fake check scams are clever ploys designed to steal your money. You can avoid becoming a victim by recognizing how the scam works and understanding your responsibility for the checks that you deposit in your account. If someone you don’t know wants to pay you by check but wants you to wire some of the money back, beware! It’s a scam that could cost you thousands of dollars.

How do fake check scams work?

There are many variations of these scams, but they usually start with someone offering to:

• Buy something you advertised for sale via newspaper ads or the internet.
• Pay you to work at home.
• Give you an “advance” on a sweepstakes you’ve won.
• Give you the first payment on the millions you’ll receive for agreeing to transfer money in a foreign country to your bank account for safekeeping.

How do these scammers find their victims?

• They scan newspaper and online advertisements for people listing items for sale and check postings on online job sites from people seeking employment.
• They place their own online ads with phone numbers or email addresses for people to contact them.
• Often times they call or send emails or faxes to people randomly, knowing that some will take the bait.
• Scammers often claim to be in other countries and say it’s too difficult to pay you directly, so they’ll have someone in the U.S. who owes them money send you a check or money order.

How do scammers get my money?

• The amount of the check or money order you receive may be more than you’re owed, so you’re instructed to deposit it and wire the rest to the scammer or to someone else.
• Or you’re told to wire some of the money back to pay a fee to claim your “winnings.”
• In some cases, the scammer promises to transfer money directly to your bank account, so you provide your account information for an electronic funds transfer. Instead, the crook sends your bank a phony check or money order with instructions to deposit it in your account.
• When you check your balance, it looks like the funds have arrived.

BEWARE - Whatever the setup, the result is the same – after you’ve wired the money, you find out that the check or money order was fraudulent.

Can my bank tell if the check or money order is good or not when I deposit it?

• These fakes look so real it’s difficult to distinguish them from the real thing.
• Some are counterfeit money orders.
• Some are phony cashier’s checks.
• Often times these checks look like they’re from legitimate business accounts. The companies whose names appear may be real, but someone has altered the checks without their knowledge.

Note: Under federal law, banks must make the funds you deposit available quickly – usually within one to five days. But just because you can withdraw the money doesn’t mean the check is good, even if it looks like a cashier’s check or money order from the post office. Forgeries can take weeks to be discovered.

If the check or money order turns out to be fake, isn’t that the bank’s problem? You are responsible for the checks and money orders you deposit. That’s because you’re in the best position to determine how risky the transaction is – you’re the one dealing directly with the person who is arranging for the payment to be sent to you. When a check or money order bounces, you owe your bank the money you withdrew. The bank may be able to take it from your account or another account to offset the loss in order to prevent possible legal action. In some cases, law enforcement authorities could bring charges against the victims because it may look like they were involved in the scam and knew the check or money order was counterfeit.

How can I protect myself from fake check scams?

• There is no legitimate reason for someone who is giving you money to ask you to wire money back – that’s a clear sign that it’s a scam.
• If a stranger wants to pay you for something, insist on a cashier’s check for the exact amount, preferably from a local bank or one with a branch in your area.
• Often times these checks look like they’re from legitimate business accounts. The companies whose names appear may be real, but someone has altered the checks without their knowledge.

If you can answer “yes” to any of the following questions, you could be involved in a fraud or about to be scammed!

• Is the check from an item you sold on the Internet, such as a car, boat, jewelry, etc.?
• Is the amount of the check more than the item’s selling price?
• Did you receive the check via an overnight delivery service?
• Is the check connected to communicating with someone by email?
• Is the check drawn on a business or individual account that is different from the person buying your item or product?
• Have you been informed that you were the winner of a lottery, such as Canadian, Australian, El Gordo or El Mundo that you did not enter?
• Have you been instructed to wire, send or ship money, as soon as possible, to a large U.S. city or to another country, such as Canada, England or Nigeria?
• Are you receiving pay or a commission for facilitating money transfers through your account?
• Did you respond to an email requesting you to confirm, update or provide your account information?

If you think someone is trying to pull a fake check scam, don’t deposit it – report it! Contact Associated Bank immediately at 1-800-682-4989 and the National Consumers League’s National Fraud Information Center at www.fraud.org or (800) 876-7060.

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