Fake checks might look like business or personal checks, money orders, cashier’s checks, or a check delivered electronically. They imitate various forms of valid payment instruments.
Whether they arrive in the mail, pop up in your email inbox, or come through an online transaction, these counterfeit checks mimic the appearance of authentic financial documents, making it challenging to discern their fraudulent nature at first glance.
Fake check scams are so dangerous because of the substantial amount of money that you can lose in a single scam. The financial impact of falling victim to these scams can be devastating, often resulting in countless consequences that extend well beyond the initial monetary loss.
1) Overpayment Scams
Assuming you’re selling an item, offering a service, or renting out your apartment on one of these platforms – everything seems routine until an unexpected twist unfolds.
Someone expresses interest in purchasing your item, paying for a service upfront, or renting your place. They send you a cashier’s check, but the amount is surprisingly higher than your asking price.
A red flag, right? When you bring it to their attention, they apologize for the alleged oversight and request you to promptly return the excess funds.
The scammer’s motive is to entice you into cashing or depositing the check and sending back the genuine money before you realize the check is fake. By exploiting a supposed mistake in their overpayment, scammers create a sense of urgency for you to return the extra funds.
In the rush to rectify the situation, most of the time you’ll overlook the fact that the initial check was counterfeit.
2) Secret Shopper Employment Scams
Imagine getting excited about an awesome job opportunity – being a mystery shopper. But, it’s all some shady deal! It sounds pretty cool, right?
Scammers pretend to be your future employers, promising you a chance to evaluate a store that sells gift cards, money orders, or offers wire transfer services such as Western Union or MoneyGram.
They send a tempting check in the mail making it seem like easy money. The scammers tell you to deposit the check into your personal bank account and then send some of that money to someone else.
Seems a bit strange, but they say it’s all part of the mystery shopping gig. Now, you’re thinking, “Wow, I’m getting paid and helping out – win-win!”
Once you wire that money to the supposed recipient, the money disappears, and so does your so-called “employer.” Poof! Gone.
The scammers use you to do their dirty work, leaving you without the promised payment. This scam is all about preying on your excitement for a new opportunity.
3) Lotteries And Sudden Riches Scams
You receive news that you’ve won a lottery, maybe even one from a foreign land, or that you’re set to inherit a substantial sum.
The scam unfolds when you’re told that, in order to claim your lottery winnings or inheritance, you need to pay upfront “taxes and fees.” They send you a fake cashier’s check, making it look as if everything is valid.
The catch is that they then ask you to cash the check and wire back the funds to cover those supposed taxes and fees. Once you’ve cashed that check and sent the money back, reality hits hard. The check bounces because it was never real, leaving you in a financial mess.
4) Personal Assistants
You’re scrolling through the internet, looking for a job, and you stumble upon what seems like the perfect gig – a personal assistant position. You apply online, and soon enough, you receive a check in the mail.
The so-called “employer” instructs you to use that check to buy gift cards and then send the PIN numbers to them. They convince you it’s a standard procedure for a personal assistant. You’re probably thinking, “Alright, if that’s what the boss says, I’ll do it.”
That unfortunate thing is that the “boss” is actually a scammer. Once they have those gift card PINs, it’s like a virtual shopping spree for them. Once the bank figures out that the check was fake, you’re left in the lurch.
The money you spent on those gift cards is long gone, and you have to deal with the consequences of unsuspectingly participating in a scam.
5) Car Wrap Decals
You come across an offer for car wrap advertising. They promise to pay you for turning your car into a rolling billboard. You respond to the offer, and soon enough, a check arrives in the mail.
The catch? The company instructs you to deposit the check into your bank account and then send a portion of that money to the so-called “decal installers.” They assure you that it’s just part of the process to get your car wrapped.
These scammers play a convincing game, making you believe you’re entering a valid business arrangement. Unfortunately, they’re just after your money. When the check you initially deposited bounces – because it’s fake – the bank realizes it, and you’re left dealing with the aftermath.
Consequences of Depositing a Fake Check
The bank, upon discovering the fraud, might swiftly withdraw the entire check amount from your account. This means the money you thought you had deposited will vanish, leaving your account in the negative if you’ve already spent or sent money based on that check.
The cash you sent to the scammer is likely gone for good. Retrieving funds from a scammer can be nearly impossible, resulting in a double loss – the initial check amount and the money you handed over.
Your banking relationship might also take a hit. Attempting to pass a fake check may trigger your bank to see it as suspicious activity.
In response, they could temporarily close or freeze your account, requiring you to submit affidavits to prove it was an unintentional mistake. Financial consequences extend beyond just the initial loss.
If you spend the funds from the fake check and overdraw your account, prepare for additional costs such as overdraft fees or late fees, especially if you miss bill payments.
On top of that, your credit score and banking history could suffer. Missing bill payments can significantly impact your credit score, potentially leading to difficulties in obtaining services from banks or credit unions.
Worst case scenario? Criminal penalties. Some state laws categorize depositing a fake check with fraudulent intent as a misdemeanor or even a felony. While victims of scams are less likely to face jail time, legal advice may become necessary to navigate potential consequences.
How To Identify A Fake Check
Here are some tell-tale signs that a check is fake:
- Smooth edges all around – Real checks usually have one perforated edge, evidence of being torn from a checkbook. However, fake checks often sport smooth edges on all sides since they’re produced by printing, not tearing.
- Paper quality matters – Feel the check. Real checks are typically printed on high-quality, thick paper with a matte finish. If the check feels thin, flimsy, or has an oddly glossy texture, it might be a fake trying to pass as the real deal.
- Name and address accuracy – Watch out for misspellings in the company’s name or a missing address. Valid checks have accurate details. Fake ones might showcase phony addresses or P.O. box numbers. Verify the bank’s legitimacy using FDIC’s BankFind tool or contact the bank directly through official channels.
- Logo legitimacy – A genuine check features the logo of the issuing bank. If your check displays a faded or unfamiliar logo, especially for a bank with a generic name like “National Bank,” it’s likely a forgery.
- Check number consistency – Check the check number twice – once at the top and once in the Magnetic Ink Character Recognition (MICR) line. If the numbers don’t match, it’s a clear sign of a fake. Low check numbers could also indicate a new account, possibly linked to a forger.
- Missing MICR line – The MICR line, printed with special ink recognizable by a reader, is a standard feature on authentic checks. If your check lacks this distinctive ink at the bottom, it’s waving a red flag of forgery.
- Routing number verification – Confirm that the routing number matches the supposed bank. Each bank has a unique nine-digit routing number. Check your bank’s real routing number via its official channels. If the number on your check doesn’t align, you’re likely dealing with a counterfeit.
Fake check scams are becoming common by the day. The scam unfolds when the fraudster convinces you to cash or deposit a check. Once the check is safely in your hands, they urge you to send back all or a portion of the money, either to them directly or to an accomplice.
This trick happens before the bank, where you deposited the check, has a chance to process or clear it and discovers the check is actually fake.
The scammer employs various methods to request the return of funds, such as asking for cash, prompting you to write a personal check, suggesting you load the amount onto a pre-paid or gift card, or encouraging electronic transactions such as wire transfers, automated clearing house (ACH) payments, or person-to-person (P2P) transactions.
Always be careful when dealing with checks because if the deposited check is later revealed to be counterfeit, you may find yourself held accountable for the funds you handed over to the scammer.
Being aware of the signs of a counterfeit check will go miles in protecting yourself from falling victim to these schemes.
