In a fake check scam, a person that you don’t know asks you to deposit a check. Sometimes, these checks can be for several thousands of dollars. They then ask you to send some of the money to another person.
The scammers always have a good story as too why you can’t keep all the money. They might tell you they need you to cover fees or to buy supplies, or something else.
Fake checks come in many forms and they look like real business checks, cashier’s checks, money orders, or personal checks, or even a check delivered electronically.
Here’s what you need to know about fake check scams.
Types of Fake Checks Scams
Fake checks are used in a lot of different types of scams.
Examples:
- Mystery shopping. Scammers pretend to hire people as mystery shoppers and tell them their first assignment is to evaluate a retailer that sells gift cards, or they might send you to a retailer that offers money orders, or a money transfer services similar to Western Union or MoneyGram. The shopper gets a check with instructions to deposit it in a personal bank account and wire it or send the gift cards to someone else. The check takes several days to clear but actually bounces as the check is a phony. You just send your personal funds to someone else. The person on the other end of the transaction disappears
- Personal assistants. Similar to the mystery shopping scam, fake checks are used. You apply online and get hired as a personal assistant. You get a check and are then told to use the money to buy gift cards or to buy supplies for their new client. Once the scammers get the gift card PIN numbers, they immediately use them, leaving you, the “personal assistant” without the money when the bank figures out the check is bad.
- Car wrap decals. Again, similar to the mystery shopping and personal assistant scam, People interested in car wrap advertising are told to deposit checks and send money to decal installers — who don’t exist.
- Claiming prizes. Another similar scam is that Sweepstakes “winners” are given checks and told to send money to cover taxes, shipping and handling charges, or processing fees. This is not how legitimate sweepstakes work.
Why These Scams Work?
These scams work because fake checks generally look just like real checks and are often printed with the names and addresses of legitimate financial institutions. It can take weeks for a bank to figure out that the check is a fake.
Gaming the System
By law, banks have to make deposited funds available, usually within two days.
When the funds are made available in your account, the bank authorizes the use of the funds, but that doesn’t mean it’s a good check.
Fake checks can take weeks to be discovered and by that time, the scammer has any money you sent, and you’re stuck paying the money back to the bank.
Your best bet: Don’t rely on money from a check unless you know and trust the person you’re dealing with or you’ve waited enough time for the funds to clear.
How to Avoid a Fake Check Scam
- Never use money from a check to send gift cards, money orders, or wire money to strangers or someone you just met. Many scammers demand that you send money through money transfer services like Western Union or MoneyGram, or buy gift cards and send them the PIN numbers. Once you wire money, or give someone the gift card PINs, it is like giving someone cash. It’s almost impossible to get it back.
- Toss offers that ask you to pay for a prize. If it’s free, you shouldn’t have to pay to get it.
- Don’t accept a check for more than the selling price. You can bet it’s a scam.
What to Do If You Sent Money to a Scammer
Gift cards are for gifts, not payments. Anyone who demands payment by gift card is always a scammer.
If you paid a scammer with a gift card, tell the company that issued the card right away. When you contact the company, tell them the gift card was used in a scam and ask them if they can refund your money. Sometimes, and If you act quickly enough, the company might give you your money back. You should also tell the store where you bought the gift card as soon as possible.
Here is a list of gift cards that scammers often use — This information will help you report a scam.
If you wired money to a scammer, call the money transfer company immediately to report the fraud and file a complaint. Ask for the money transfer to be reversed. It’s unlikely to happen, but it’s important to ask.
- MoneyGram at 1-800-MONEYGRAM (1-800-666-3947)
- Western Union at 1-800-325-6000.
If you paid a scammer with a money order, contact the company that issued the money order right away to see if you can stop payment.
If you sent it by U.S. mail, contact the U.S. Postal Inspection Service at 877-876-2455. Otherwise, contact whatever delivery service you used as soon as possible.
Where to Report Fraud
If you think you’ve been targeted by a fake check scam, report it to:
