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Spotting a fake check requires taking steps like examining the check, analyzing the check source and more. Scammers can use counterfeit personal checks, cashier’s checks and even certified checks for fraudulent activity. So even if you trust a person you’re doing business with — and the check they hand you looks legit — it’s important to look beyond the dollar signs and verify that the check is legitimate.
We’ll walk you through how to do that as well as how to report a fake check scam if you notice one.
Protecting yourself from fake checks and check fraud means being cautious about accepting checks from anybody you don’t know. There are a couple steps you can take to ensure you don’t fall victim of a check fraud scam.
First, look very closely at any check you receive — whether it’s a personal, cashier’s or certified check. Cashier’s checks used to be as good as gold, but they’re one of the most common forms of fake checks today. Scam artists often use sophisticated technology to create checks that look real, but here’s what to watch for:
If you receive a check in the mail or from someone you didn’t contact, take time to investigate who’s giving you money and why. Research the person or company to see if the payment makes sense and check any email exchanges you had with them.
For example, mystery shopping is a legitimate working opportunity, but companies that hire shoppers don’t send checks in advance. Verify that the mystery shopping opportunity is real by checking with the Mystery Shopping Professionals Association.
Modern day technology has made a wide range of fake check schemes possible, including everything from foreign lottery scams to secret shopper scams. Here are some of the most common fake check schemes to be vigilant of.
With the foreign lottery scam, you get an email or letter that informs you that you’ve won a foreign lottery or received an inheritance from a distant relative. The scammer sends you a check and asks that you deposit it in your bank account and wire back money to pay fees or foreign taxes. The fake check eventually bounces, but you’ve already sent the scammer some of your own real money.
This scam targets people selling cars or other high-priced items via online classified ads. The scammer replies to your post and sends you a check, but it’s for more than your sales price. The scammer will claim they made an error in filling out the fake check, and request that you deposit it anyway and refund the extra via wire transfer. Their check bounces, leaving you missing the amount you “refunded.”
The check repayment scam is similar to the internet auction scam, but this time the scammer who wants to purchase your item says that they’re owed money from a third party who will send their money directly to you in repayment. However, the fake check is for more than the purchase price, and you’re instructed to wire them the difference.
With this gem, scammers tell you that you’ve been hired as a mystery shopper to evaluate the services of a money transfer company. You’re sent a check to deposit into your checking account, then asked to withdraw the money and wire a portion to a specific person. You’re told to “keep” a portion for your services. The fake check bounces and you’re liable for the money withdrawn, which can be several thousand dollars.
The consequences of depositing a fake check are serious — if the check is fraudulent and bounces, your bank has the right to withdraw the funds from your account, which can leave you with a negative balance and overdraft fees.
You could potentially even face consequences, such as having your account closed or having your credit rating dinged. On the most serious end of the spectrum, you could be charged with fraud in the case that law enforcement thinks that you knew the check was fake.
Under federal regulations, banks must make funds available within one to five days, depending on the type of check. A government or cashier’s check, for example, must be cleared one business day after you deposit the check, which is why they’re commonly used in check fraud. Unfortunately, fake checks can take weeks to be identified.
If you have been the victim of check fraud or you think you’re being scammed, report it. Although it may be embarrassing to admit you’ve been duped, scammers won’t be caught if no one reports the activity. To report a fake check, you can take these steps: