Check Fraud - What You Need to Know
One of the most common themes seen with check fraud is when money is provided in advance of the action a person is requested to take. It is often presented as "pre-payment" to help the scammers build trust and alleviate victims' concerns that the deal might be fraud.
How check fraud works
Even when a check is credited to your account, it does not mean the check is valid. A week or so later, if the check bounces, the financial institution will want the money back. And you, not the scammers, will be responsible for paying back the funds.
Check fraud examples
This type of scam happens to many people every year. Here are a few examples:
• "Buyers" send checks for more than the full price to sellers
• "Employers" send checks to new hires to buy supplies needed to do jobs from home
• Sweepstakes or lottery "winners" are given checks to pay taxes so awards can be delivered
• Relationship/romance scams happen once the victim becomes attached and then the scammer looks for ways to con the person into sending money.
These scams involve the use of counterfeit checks which are altered versions of business, personal, or certified checks.
How to avoid being a victim of check fraud
Here are some questions to ask yourself if you are unsure about the validity of a check:
• Is there a sense of urgency?
• Were you expecting the check?
• Is the amount unusual, or different than what you were expecting?
• Do the personal details match?
• Is the check missing a signature, the financial institution's logo or address?
A general rule: If you receive a check, do not purchase gift cards, send funds back, or purchase and mail items from a new source you have not established a legitimate relationship with.
What to do if you suspect check fraud
If you suspect something is off with a check, before cashing it, contact your financial institution or the financial institution the check is from. Just because you can withdraw the money doesn't mean the check is legitimate, even if it's a cashier's check or money order. Fraudulent checks can take weeks to be identified.
Trust your instincts. If something seems off with a check, or the situation in which you're being provided with a check, contact your financial institution. And keep in mind: "If it sounds too good to be true, it probably is."