Fake Check Scams

Most consumers who use the Internet know to be wary of suspicious messages sent to their electronic mailbox, but what about regular mail? Federal regulators and consumer advocates are reporting that an increasing number of scammers are using an old tactic - bogus checks sent to postal mailboxes - in their attempts to trick consumers into parting with their hard-earned dollars. The National Consumer League reported a sixty percent increase in consumer complaints regarding fake check scams in the past year and that victims of the scams are losing an average of between three and four thousand dollars.

One popular scam uses the promise of lottery winnings to trick consumers into wiring money to the sender. Victims receive a letter claiming that they have won a foreign lottery accompanied by a check to cover lottery taxes and fees. Victims are instructed to deposit the check and wire funds to the sender in order to pay the taxes and fees on the prize. According to the letter, when the funds are received, the winner will get their prize. The check is a fake and once the forgery is discovered, the victim's bank deducts the amount that was previously credited to the account. Many consumers do not realize that under federal law banks must make funds available to customers who deposit cashier's checks, certified checks, and teller's checks, and they must release funds from other checks within two to five days, depending on the location of the check writer's bank. Scammers know that if they produce a realistic-looking check, it can take a bank weeks to discover that the check is counterfeit. Until the bank confirms that the funds have been deposited, the victim is responsible for any funds withdrawn against the check.

Another popular form of this scam involves overpayments. Scammers buy merchandise online and then claim that they mistakenly wrote the check for the wrong amount. The seller is asked to deposit the check anyway and send the excess amount to the buyer. In this scenario the victim loses the merchandise and the money sent to the scammer. Consumers should also be wary of work-at-home business scams. In this scenario, fraudsters fool victims into helping them "process" payments by depositing bogus checks. The victim is then told to send most of the money to the scammer and keep the extra amount as payment for the service. Legitimate businesses never operate in this fashion. Another take on this form of fake check scam involves "mystery shopping." Here victims are sent a check or money order to "test" a money transfer service or shop at a particular store. The victim is instructed to send any extra money back to the scammer. When these checks fail to clear, the victim is out of luck.

While these scams can take many forms, they all follow the same basic pattern. If you receive a letter accompanied by an official-looking check or money-order and instructions to send cash back to the sender throw it away. Never wire money to someone you do not know. If you are selling goods or services, be sure that the buyer writes a check for the exact amount; do not accept a check for more than the selling price. If you believe that you have been targeted by a fake check scam, you should consider reporting it to the New York State Attorney General's Office. You can do so by calling 1-800-771-7755, visiting http://www.oag.state.ny.us/complaints/ complaints.html, or writing to: Office of the New York State Attorney General, The Capitol, Albany, NY 12224-0341. You may also want to report the scam to the Federal Trade Commission at www.ftc.gov or by calling 1-877-382-4357. The U.S. Postal Inspection Service is also gathering information on fake check scams. To report suspicious activity to the Postal Service, visit http://postalinspectors.uspis.gov/, or call your local post office.

For more information on the latest fake check schemes, you may visit the Alliance for Consumer Fraud Awareness website at: http://www.fakechecks.org/.

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