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Tips for
Recognizing and Avoiding Fake Check Scams
If someone you don’t know wants to pay you by check but
wants you to wire some of the money back, beware! It’s a
scam that could cost you thousands of dollars.
- There are many
variations of the fake check scam. It could start with
someone offering to buy something you advertised, pay
you to do work at home, give you an “advance” on a
sweepstakes you’ve supposedly won, or pay the first
installment on the millions that you’ll receive for
agreeing to have money in a foreign country transferred
to your bank account for safekeeping. Whatever the
pitch, the person may sound quite believable.
- Fake check scammers hunt
for victims. They 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.
They often claim to be in another country. The scammers
say it’s too difficult and complicated to send you the
money directly from their country, so they’ll arrange
for someone in the U.S. to send you a check.
- · They tell you to wire
money to them after you’ve deposited the check. If
you’re selling something, they say they’ll pay you by
having someone in the U.S. who owes them money send you
a check. It will be for more than the sale price; you
deposit the check, keep what you’re owed, and wire the
rest to them. If it’s part of a work-at-home scheme,
they may claim that you’ll be processing checks from
their “clients.” You deposit the checks and then wire
them the money minus your “pay.” Or they may send you a
check for more than your pay “by mistake” and ask you to
wire them the excess. In the sweepstakes and foreign
money offer variations of the scam, they tell you to
wire them money for taxes, customs, bonding, processing,
legal fees, or other expenses that must be paid before
you can get the rest of the money.
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They tell you to wire money to them after you’ve
deposited the check. If you’re selling something, they
say they’ll pay you by having someone in the U.S. who
owes them money send you a check. It will be for more
than the sale price; you deposit the check, keep what
you’re owed, and wire the rest to them. If it’s part of
a work-at-home scheme, they may claim that you’ll be
processing checks from their “clients.” You deposit the
checks and then wire them the money minus your “pay.” Or
they may send you a check for more than your pay “by
mistake” and ask you to wire them the excess. In the
sweepstakes and foreign money offer variations of the
scam, they tell you to wire them money for taxes,
customs, bonding, processing, legal fees, or other
expenses that must be paid before you can get the rest
of the money.
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The
checks are fake but they look real. In fact, they look
so real that even bank tellers may be fooled. Some are
phony cashiers checks, 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.
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You don’t
have to wait long to use the money, but that doesn’t
mean the check is good. Under federal law, banks have to
make the funds you deposit available quickly – usually
within one to five days, depending on the type of check.
But just because you can withdraw the money doesn’t mean
the check is good, even if it’s a cashier’s check. It
can take weeks for the forgery to be discovered and the
check to bounce.
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You are
responsible for the checks you deposit. That’s because
you’re in the best position to determine the risk –
you’re the one dealing directly with the person who is
arranging for the check to be sent to you. When a check
bounces, the bank deducts the amount that was originally
credited to your account. If there isn’t enough to cover
it, the bank may be able to take money from other
accounts you have at that institution, or sue you to
recover the funds. 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 was counterfeit.
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There is
no legitimate reason for someone who is giving you money
to ask you to wire money back. If a stranger wants to
pay you for something, insist on a cashiers check for
the exact amount, preferably from a local bank or a bank
that has a branch in your area.
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