What’s a Fake Check Scam?

Check scams have been around a long time but they still seem to be effective for the crook, since fake check scams is the number one telemarketing and Internet fraud scam. These scams come by mail, phone or email and usually involve wiring money back from a cashier check. These checks look real and the scammers are experts at making the request seem legitimate. Cashier checks are disposed of quickly, considered cash and can’t be traced; you cannot get your money back.

In this economy, it can be easy to fall prey to an easy way to make money. You need to be aware and alert. Keep in mind, it can take weeks before the bank determines that the check is counterfeit and will charge it back to you, even a cashier check. The bank could even close your account because of this.

There are many types of scams such as work from home, sweepstakes, mystery shopper, overpayment for internet purchases and friend in need of money overseas. Young people and the elderly are more susceptible to these scams. Young people are scammed by work at home schemes and elderly by sweepstakes.

Work from home

If you are unemployed and post resumes on job board, it is not uncommon to receive work from home emails from scammers. It is from an international company requesting that you process payments for them, deposit the checks, take out your pay and wire the remainder. These companies could process the payments themselves and don’t need you.

Sweepstakes or lottery

To retrieve your prize or winnings, you have to give them some money upfront for service charges and taxes. No legal sweepstakes require this. Did you enter the sweepstakes or lottery? How could you win if you didn’t enter?

Mystery shopper

The company sends you a cashier check prior to doing the work.  You are to wire money using Western Union to test their services.  The check includes the amount for the wire and your salary. Sending a wire is like sending cash, the cashier check is counterfeit and you will owe this amount to the bank.  Mystery shoppers don’t get paid in advance and are not paid hundreds of dollars for each job; the range is $10 to $25 per job.

Overpayment

You have listed items you are selling on sites such as eBay or Craigslist and the buyer has a cashier check he received for more than the amount.  They want you to take out the purchase price plus an additional amount for your inconvenience and wire the difference to them. Do not accept the check or deposit it and don’t wire them money.

Friend in need of money

You receive an email that was supposedly sent from a friend visiting an unfriendly country and had their wallet stolen. This included credit cards, cash and plane ticket; they need money wired to them so they can return to the U.S.  This is a scam; contact your friend first before taking any action. I know people that have received this email.

Clues to consider

  • Live out of the country
  • Ask you to wire money
  • Pay upfront to get sweepstakes prize
  • Receive a cashier check

Don’t fall for these scams and don’t wire money to anyone you don’t know. If it is too good to be true, it is. If you receive a scam by mail visit www.deliveringtrust.com; fraudulent checks contact the Federal Trade Commission at www.ftc.gov ; or sweepstakes scam contact www.ic3.gov.

John Ulzheimer is the President of Consumer Education at SmartCredit.com, the credit blogger for Mint.com, and a Contributor for the National Foundation for Credit Counseling.  He is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO, Equifax and Credit.com, John is the only recognized credit expert who actually comes from the credit industry.  Follow him on Twitter here.

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