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If someone
you don’t know wants you to pay 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 the scam.
It usually starts with someone offering to:
·
Buy something you advertised for sale;
·
Pay you to work at home;
·
Give you an “advance” on a sweepstakes you’ve won;
or
·
Give you the first installment on the millions
you’ll receive for agreeing to transfer money in a foreign country to
your bank account for safekeeping.
The 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.
The amount of the check or money order 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.
In
some cases, the scammer promises to transfer money directly to your bank
account. 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 into your account. When you check
your balance, it looks like the funds have arrived. Whatever the set-up,
the result is the same – after you’ve wired the money, you find out that
the check or money order has bounced.
Can my bank
tell if the check or money order is good or not when I deposit it?
These fakes
look so real that even bank tellers may be fooled. Some are counterfeit
money orders, some are phony cashier’s checks, and others look like
they’re from legitimate business accounts. The companies whose names
appear may be real, but someone has dummied up the checks without their
knowledge.
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 accounts or sue you to recover it. 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 do these
scammers find their victims?
Fake check
scammers 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 ads with phone numbers or email
addresses for people to contact them. And they call or send emails or
faxes to people randomly, knowing that some will take the bait.
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 is 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.
If you think
someone is trying to pull a fake check scam, don’t deposit it – report
it!!
Contact the National Consumers League’s
National
Fraud
Information
Center,
at
www.fraud.org or toll-free 800 876-7060.
There are also more detailed tips about fake check scams in the
telemarketing and Internet fraud sections of the Web site.
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