Discover how to protect yourself against scammers using fake checks to steal money.

Everyday millions of checks are deposited without problem. Unfortunately, some deceitful people use fake checks to steal money from unsuspecting folks. And their scams can take many forms. People of all ages—from those in their early twenties to those in retirement— have experienced losses from fraudulent check scams. Here’s what you should know so you don’t fall victim to a bad check scheme.

Mystery shopper scams

Fake mystery shopper scammers ask you to evaluate a store that offers a money transfer service, such as Western Union or MoneyGram. The shopper receives a check and is told to deposit it in their personal account, then wire the money someplace else. What’s really happening is that the shopper who follows through with this deposits a bad check and the money withdrawn is from their personal funds. In time it becomes clear that the check is fake. When the shopper tries to contact the fraudulent check writer they’re nowhere to be found. 

Buying scams

It’s not a good sign when someone purchasing an item from you wants to write the check for more than the agreed-upon selling prices. Let’s say you’re selling a bike for $150. An untrustworthy buyer may ask you to accept a check for $200 and provide $50 back in change. Often, there are no funds to cover the bad check and the seller is out $200 and the item.

Prize scams

Some check fraud occurs when the scammer asks the victim to write a check to cover prize taxes or fees. For example, they’ll say you’ve won a prize but before you can receive it you need to pay for taxes. If someone asks you to write a check to cover taxes on a prize, you’re definitely not a winner. Those who fall prey to this scam send a check, lose the money, don’t receive a prize and never hear from the scammer again. 

A cleared check isn’t necessarily a good check

By law, a bank has to make deposited funds available fairly quickly. Usually, this is about two days. However, it can take weeks until a fraudulent check is discovered. By then, the scammer is long gone.

Protect yourself and loved ones

The best way to protect your checking account is by becoming aware of the ways to spot and avoid fake check scams. The Federal Trade Commission’s online information on spotting scams is very informative.

Here are a few best practices to follow to protect your money:

• Never wire money to someone who sent you a check.
• Never take a check for more than your selling price. If selling online, consider using an escrow or online payment service.
• Never pay for fees or taxes to receive a prize.

The best protection against fraud is awareness. Consider sharing this information with your loved ones, both young and old, to help prevent scammers from succeeding at bad check schemes.

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