How to Spot a Fake Check

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Updated on Tuesday, June 25, 2019

With so many forms of electronic payment available today, you probably don’t write many personal checks anymore. Nevertheless, checks are an increasingly popular vehicle for scammers trying to swindle people out of money.

According to the National Consumers League (NCL), fake check schemes were the third most popular scam committed in 2018. The Federal Trade Commission (FTC) found that reported check fraud cases in 2018 represented a loss of $75 million. The FTC reported a median loss of $1,214 per fraud.

“Fake check scams have been a serious consumer issue for years, and it’s one that continues to be with us with the nature of the scams evolving,” says John Breyault, NCL’s vice president of public policy, telecommunications and fraud.

Scammers 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 any check is legitimate.

Beware common fake check schemes

“Check fraud used to entail someone stealing checks out of the mail and forging them,” says Jim Wilcox, assistant vice president of risk operations for Affinity Federal Credit Union, in Basking Ridge, N.J. “But with the internet and the passing of remote deposit captures, the opportunities and means by which people use fake checks to commit fraud has grown exponentially.” These are the four most common fake check schemes:

Foreign lottery scams

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.

Internet auction scams

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.”

Check repayment scams

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.

Secret shopper scams

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.

How to protect yourself from a fake check

Protecting yourself from fake checks and check fraud means being cautious about accepting checks from anybody you don’t know. There are several steps you can take to ensure you don’t fall victim of a check fraud scam.

Examine the check

First, look very closely at any check you receive — personal, cashier’s or certified. Cashier’s checks used to be as good as gold, says Wilcox, 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:

a

Confirm that the payee’s name and the person giving you the check match.

b

Look for security features, such as watermarks.

c

Check for a perforated edge, such as where it’s been torn from a checkbook or register. Counterfeit checks often have smooth edges because they’re printed on a computer.

d

Make sure the check includes the bank logo and address, and that both are correct.

e

Look at the magnetic ink character recognition (MICR) line on the bottom of the check, which will include the bank routing number, the account number, and the check number. Match the routing number to the issuing bank by searching the American Bankers Association website.

f

Look at the paper. Real checks are printed on matte sturdy paper.
  • Confirm that the payee’s name and the person giving you the check match.
  • Look for security features, such as watermarks.
  • Check for a perforated edge, such as where it’s been torn from a checkbook or register. Counterfeit checks often have smooth edges because they’re printed on a computer.
  • Make sure the check includes the bank logo and address, and that both are correct.
  • Look at the magnetic ink character recognition (MICR) line on the bottom of the check, which will include the bank routing number, the account number, and the check number. Match the routing number to the issuing bank by searching the American Bankers Association website.
  • Look at the paper. Real checks are printed on matte sturdy paper.
  • Rub a damp finger over the printed areas of the check to make sure they don’t smear.

Ask yourself if the check source is legit

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 emails you had with them. 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.

Do not spend the money before the check is verified

Don’t cash the check right away, but if you need to cash it, hold on to the money and do not spend it. 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.

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.

“The account number and routing number might not jive, and the check could be bounced around in an attempt to be routed to the right bank, adding time to clearing,” says Wilcox.

Report suspected fraud

If you have been the victim of check fraud or you think you’re being scammed, report it. It’s embarrassing to admit you’ve been duped, but scammers won’t be caught if no one reports the activity. Take these steps:

Who’s responsible for a fake check?

It’s bad enough to have fallen victim to a scam, but ultimately you’re responsible for any check you accept and deposit, says Breyault.

“If you wired money, it’s gone and practically impossible to get it back,” says Breyault. “The bank will want to be repaid, and that will fall on the consumer to shoulder the cost.”

The final word on fake checks

Scammers will continue to use fake check schemes as long as they can find willing victims. Don’t fall for their schemes. Scrutinize any check you receive, especially if it comes out of the blue, as with the inheritance scam, or it’s written for more than the selling price during a transaction. If the windfall is too good to be true, it probably is.

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