Don’t Lose Money to Fake Check Scams

Counterfeit checks have been around for as long as banks have existed. Early check scams were executed through signature forgeries once a victim’s checkbook was stolen. Check scams today are hi-tech. Scammers use advanced printers to scan and print authentic-looking checks that escape detection from trained bank clerks.

Some of these checks get cashed first and only flagged as fraudulent weeks later. That’s how adept check scams are today.

Fake checks make it possible to pull off all these other scams:

• Money Mule scams
• Sugar Baby scams
• Marketplace scams
• Sweepstakes and Lotto scams
• Inheritance scams

 Checks can be fake in three main ways:

• Counterfeit check - a check that has not been issued by the account holder.
• Forged check – a stolen check signed by someone other than the account holder.
• Fraudulent or altered checks - these are issued by a legit account holder then intercepted and altered to show different amounts than the original.

Signs of a Fake Check Scam

Whenever you see these signs, it may be that you are being set up for a check scam:

• The insistence to only use checks as a means of payment or cash transfer.
• Being asked to wire some money back to the sender or send it to a different account when you cash a check.
• Claims of being in another country where the person cannot cash a check for any number of reasons. Usually sold through a sob story.
• Overpayments made via checks.
• Secret shopper jobs - some sellers hire people to shop for their own products and create the impression that their product is moving. Hired shoppers are usually overpaid through checks and asked to send back the balance once they cash the check.
• Lottery wins that promise to send you a check through the post but ask for costs to cover “taxes and fees” first. Whatever check you get in such a case will be fake. 

Some Common Check Scams

Overpayment Scam

The scammer sends you a check through the post with a reason for their overpayment, then asks you to deduct your payment plus a little extra for your trouble and send the rest back to them or to a different account. This is the way money mule scams operate and use these scam tactics to move money through the banks undetected. Some sugar baby scams also work in a similar way when money is sent to a love interest with requests to send the rest to another person.

Adding Extra Names in Payee Line

Another scam in altered checks is the addition of names in the payee line. A check issuer writes a check for a certain amount to an individual but it is intercepted by scammers and another payee is added in a way that’s undetectable to the bank.

Fake IRS Refund Check

This scam pops up around tax season in the US when individuals and businesses need to file their tax returns. Scammers obtain the emails and details of their targets from social media and send them an email about being due for a tax refund. Such emails have links directing victims on how to claim their refund.

Those who follow the link and directions eventually receive an email from the real IRS that the refund was sent even though the victims didn’t receive a dime! Scammers change the details in the refund claim to obtain the amount for themselves.

 

How to Protect Yourself from Fake Check Scams

• Never accept overpayments through checks. Ask the check issuer to cancel it and write one with the precise amount for payment. Don’t fall for the false generosity scammers use to hook unsuspecting victims; where they ask you to take a bit more than the cost of payment to soften you for their scam.
  
  
• Use checks carefully when dealing with new or unknown clients. Allow the maximum time according to your bank, needed for fraud checking and detention before shipping your product.
  
  
• Prefer taking checks from people you know and trust. Keep your business relationships with trustworthy clients. Where there is doubt, opt for payment modes that will not backfire on you like a fake check.
  
  
• Notify your bank immediately you sense you made a fake check deposit so they can stop/cancel cashing it out.