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Be Careful… Fake Checks Are Popular Tools For Criminals & Scammers

Be Careful… Fake Checks Are Popular Tools For Criminals & Scammers

There’s something about a check, whether it’s a cashier’s check or other official bank check that gives many people a greater sense of security than electronic money transfers. Unfortunately, criminals and scammers know that all too well and often use fake checks to get money from their victims.
Technology is constantly improving and it’s now easier than ever for someone to create fraudulent checks, fakes that are increasingly hard to detect.
How Fake Check Scams Typically Work
A recent article from the Federal Deposit Insurance Corporation (FDIC) reported that fake checks are often sent by scammers to potential victims in the hope that the recipient will either cash the check or deposit the check. Why? Because sending the check is only the first step of the scam; the second step involves asking the recipient to send all or part of the proceeds from the fake check back to them or to an accomplice.
Typically, the scammer will ask for the money in the form of cash, a personal check, by loading it on to a pre-paid or gift card, or possibly a wire transfer or other electronic means. Getting this money, in whatever the form, is the scammer’s ultimate goal.
Unfortunately, once it’s discovered the check that was cashed or deposited was counterfeit, the victims of these kinds of scams will not be able to recover the money paid to the scammers.
 
Three of the Most Common Fake Check Scams
The FDIC has identified three of the most common fake check scams, although it’s important to remember that scammers are constantly coming up with new ideas for how to get to your money.
  1. Lotteries and Sudden Riches Scams
You have won a lottery – often in a foreign country and a lottery you weren’t even aware you had a chance to win. Or perhaps you are entitled to an inheritance you knew nothing about. Of course, there are taxes and fees that need to be paid before you can claim your prize or collect the inheritance, which is why you have been sent a cashier’s check for the amount to cover those taxes and fees. All you have to do is cash the check and then wire the money back and then your big windfall will be coming your way. Of course, the cashier’s check is fake.
 
  1. Online Auctions, Classified Listing Sites and Overpayment Scams
According to the FDIC, another popular scam involves scammers offering to buy an item for sale, purchase a service in advance, or even rent an apartment you have offered on an online auction or in a classified listing. Then they will send a check for more than the amount of the asking price. Embarrassment at their mistake follows and they ask if you could quickly return the extra funds. Again, the goal is to get you to deposit the fake check and send back real money before it’s discovered the check you deposited is fake.
 
  1. Secret or Mystery Shopper Employment Scams
An FDIC article from August, 2019 says this type of fake check scam uses the appeal of working from home to get money from its victims.
 
“The scammer advertises a job opportunity and claims to be "hiring" people to work from home. The ‘employee’ might receive an official check as a starting bonus, and is asked to cover the cost of ‘account activation.’ The scammer hopes to receive these funds before the official check clears and the new employee realizes they’ve been scammed.

Another scenario involves an offer to work from home as a secret shopper to "assess the quality" of local money transfer businesses. The ‘employee’ is sent a cashier’s check and instructed to deposit it in their bank account and withdraw the amount in cash. They are then instructed to use a local money transfer business to send the funds back to the ‘employer’ and ‘evaluate’ the service provided by the money transfer business.”
 
 
How To Spot A Fake Check
 
While not always easy, there are certain clues to follow when trying to identify if a check is real or fake. The FDIC encourages you to follow these warning signs.
 
  1. Make sure the name of the bank on the check is a real bank. Quite often, scammers will use a fake bank name.
  2. If the bank name is real, contact that bank to find out if the check is real. Do not rely on a phone number on the check since that may be a number controlled by the scammer. Get the phone number from the bank’s official website. When verifying the check you will need to supply the check number, the issuance date and the amount of the check.
  3. If someone you don’t know sent you the check, be very skeptical, at the least. Especially, if the initial communication was through email or text. Often there are numerous grammatical and/or spelling errors in those communications.
  4. Where did the check come from? If it came from overseas, be on your guard. Also, if the postmark on the envelope is from a different city and/or state from the bank shown on the check that is another indication the check is quite possibly fake.
  5. If the amount is for more than expected or what was agreed to, realize the check could be fake. The scammer is looking for you to send back the “overpayment”.
  6. Official checks usually contain watermarks, security threads, color changing ink and other security features. Often scammers will attempt to imitate these features, but the quality of their efforts is often poor.
 
Think You Are A Victim Of A Fake Check Scam?
 
If you are being targeted by what you believe to be a fake check scam, or if you think you have been a victim of such a scam, the FDIC recommends immediately contacting one of the following agencies:
 
 
The Federal Trade Commission at FTC Complaint Assistant.
The U.S. Postal Inspection Service at www.uspis.gov (if you received the check in the mail).
Your state or local consumer protection agencies. Visit NAAG for a list of state Attorneys General.
For possible online crimes involving counterfeit checks and money orders, file an online complaint with the Internet Crime Complaint Center (a joint project of the FBI and National White Collar Crime Center).
 
In addition to notifying the bank whose name is on the check, you can notify the website or online service where you encountered the scammer (for example, the online auction website or job posting website), so they can block them from utilizing their services in the future.