How To Spot, Avoid, Report Fake Check Scams
Fake checks might look like business or personal checks, cashier’s checks, money orders, or a check delivered electronically. Here’s what to know about fake check scams.
In a fake check scam, a person asks you to deposit a check. It’s usually for more than they owe you, and it’s sometimes for several thousand dollars. They tell you to send some of the money back to them or to another person. They always have a good story to explain why you can’t keep all the money. They might say they need you to cover taxes or fees for a prize, to buy supplies for a job, to send back money they overpaid, or something else. But this is a scam.
Types of Fake Checks Scams
Lots of scammers use fake checks to get your money. Here are some examples:
- Mystery shopping. Scammers pretend to hire you as a mystery shopper. They tell you that your first assignment is to evaluate a retailer that sells gift cards, money orders, or a wire transfer service like Western Union or MoneyGram. You get a check with instructions to deposit it in a personal bank account and wire some of the money to someone else. But once you do, the money is gone and the so-called “employer” can disappear, too.
- Personal assistants. You apply online and think you’re getting hired as a personal assistant. You get a check and are told to use the money to buy gift cards and send the PIN to your “boss.” But that’s a scammer, and once they get the gift card PINs, they use them instantly. That leaves you without the money when your financial institution figures out the check was fake.
- Car wrap decals. You respond to an offer for car wrap advertising. The company tells you to deposit a check and then send money to decal installers. But it’s a scam, the installers aren’t real, and now your money is gone.
- Claiming prizes. A sweepstakes says you’ve won and gives you a check. They tell you to send them money to cover taxes, shipping and handling charges, or processing fees. But that’s not how legitimate sweepstakes work — and you’ll be out any money you send.
- Overpayments. People buying something from you online, “accidentally” send a check for too much, and ask you to refund the balance. But that’s a scam.
Fake Checks and Your Financial Institution
- By law, financial institutions must make deposited funds available quickly, usually within two days. Fake checks can take weeks to be discovered and returned. By that time, the scammer has the money you sent, and you’re stuck paying the money back to your financial institution.
- Mobile Deposit services could be taken away, meaning all check deposits must be brought into your local branch for physical review.
- If your financial institution suspects you are willingly participating in check fraud, your account could be frozen, suspended, and possibly closed. You will be financially responsible for paying the money back to your financial institution.
- Your best bet: Don’t rely on money from a check unless you personally know and trust the person you’re dealing with.
How To Avoid a Fake Check Scam
- Never use money from a check to send gift cards, money orders, cryptocurrency, or to wire money to anyone who asks you to. Many scammers demand that you buy gift cards and send them the PIN, buy cryptocurrency and transfer it to them, or send money through wire transfer services like Western Union or MoneyGram. Once you do, it’s like you’ve given them 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. Only scammers will ask you to pay to collect a “free” prize.
- Don’t accept a check for more than the selling price. You can bet it’s a scam.
Report Fraud
If you think you’ve been targeted by a fake check scam, report it to:
Safeguard Your Information
- Never provide confidential information, such as Social Security Number or Date of Birth, to someone unless you have initiated the contact.
- If you are contacted by phone or email and asked to confirm your confidential information, do not respond. Contact us immediately at 800-331-6268 or send us a notification on our website: www.tronavalley.com. Do not use the phone number provided in the email correspondence or that the caller provides to you.
- Do not share passwords or your Personal Identification Number (PIN) with anyone.
- When completing online applications or making purchases, ensure the website is utilizing encryption and the page shows as “https”.
- Do not record your Social Security number on a check, traveler’s check, gift certificates, etc., unless required by law.
- Do not share confidential information such as your Date of Birth or Address on social media. Fraudsters can obtain this information and begin to build a “synthetic ID” to commit fraud.
- If possible, go to the United States Postal Service and put your mail in their drop box. We highly recommend not putting it in your mailbox at home as fraudsters can steal your mail and obtain your name, address, routing number, and account number off of your check.
Eliminate Paper
- Utilize electronic options, such as Direct Deposit, eStatements or Bill Pay to reduce paper with your personal information printed on it which could be stolen in the mail.
- Watch for the signs of identity theft such as receiving bills in the mail for things you didn’t authorize.
- Utilize a shredder to render paper bills and statements unreadable.
Secure Your Computer & Mobile Device(s)
- Employ strong passwords and PINs on all devices.
- Engage auto-lock features on devices.
- Change passwords regularly and never share them with anyone.
- Do not allow your computer or mobile device to save passwords.
- Do not click on links embedded in emails or text messages that look suspicious.
- Ensure your device is equipped with Anti-Virus, Firewall, or other computer security features.
- Keep your operating system and software up to date by installing updates as soon as possible.
Spot Phishing Attempts
Criminals “phish” for your personal information. Phishing can take place via phone calls, emails, text messages, visiting your place of business or by directing you to a phony website that claims to be a legitimate business.
Criminals attempt to trick us into believing the communications we are seeing, or hearing, are from someone we can trust. They disguise their emails and text messages to look as though they’re from a legitimate business. Often, they employ some type of scare tactic to entice you to open the communication and/or provide account information. For example, emails and text messages may state they are from:
- UPS claiming there is a “problem with your shipment.”
- A financial institution claiming there is a “problem with your banking account.”
- The Better Business Bureau stating “A complaint has been filed against you.”
- Court system stating that “You have been served with a subpoena.”
Another trick will be to make something sound easy, such as “complete this quick survey.”
If you receive a phone call, email, text message, or visit to your place of business that you question, take the time to validate the communication before taking any action requested. Do not use the contact information provided in the email, text message, or by the individual. Instead, use the number advertised on the company’s statement or website.
Protect Against Malware
Malware is generally a computer virus or spyware intended to harm your computer. Computers become infected with malware through several mechanisms – sharing files on USB drives or DVD’s, opening suspicious e-mail attachments, clicking on links in e-mails, or visiting websites that are themselves infected with malware. Malware can also arrive with downloaded files, such as music or videos from peer-to-peer file sharing networks, or simply by visiting a website that has been hacked and infected.
Any website that is not properly secured can be hacked and infected with malware that could infect your computer. You will not likely receive any warning that malware is being downloaded onto your computer. In most cases, the website owners themselves do not know their sites have fallen victim to dispersing criminal malware.
Don't Become a Money Mule
Money mules are victims who become a middleman for the laundering of illegal or stolen funds. The victim is lured by an easy way to make large sums of money. Criminals then ask for the funds to be sent to another recipient, who is often the criminal. The layering of transactions helps to mask the criminal’s identity. The money mule may keep a commission for performing the transfer or wire. The victims of these scams are often left financially responsible for returning the stolen funds.
Common signs of a money mule scam:
- Overseas companies requesting money transfer agents in the United States.
- Opening new bank accounts to receive money from someone you don’t know.
- Accepting large sums of money into your personal bank account for a new job.
- Transferring or wiring funds out of your personal bank account to people you do not know.
Looking for More Information?
If you are a victim of financial fraud
File a fraud report through the Federal Trade Commission. That's the agency tasked with shutting down scammers. They use these fraud reports to help them build their cases. If you're a victim of identity theft, report your case at IdentityTheft.gov. Consider filing a report with your local law enforcement. They may not investigate your case, but the report could help you dispute fraudulent transactions.
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