Fake Checks

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People being ripped off by a person who sent them a fake check is a common scam. Unfortunately people still fall for it or the scammers wouldn’t still be doing it. I almost fell for a scam like this myself about 9 years ago. Here is how the fake check scam works and what to look out for.

There are really two basic ways these scammers will come at you. The first is if you are trying to sell something online and the second is if you are looking for a job, whether it is a legitimate work from home opportunity or more traditional employment doesn’t matter. But this scam can ultimately be initiated any time there is some type of financial transaction that needs to take place.

Here is a very basic example of how a fake check scam works.  You find this great work at home opportunity for “processing checks.” You see the ads all the time.  Of course they are in another country and it is too hard (legal fees, customs, bonding, etc…) for them to take checks from their clients directly in your country. So your job will be to deposit the checks from their clients into your bank account and wire them the money minus your pay and associated fees.  Sounds easy enough, right?

The only problem is that the checks that are sent to you are fake checks. They often seem to come from real companies or look like legitimate cashier’s checks, but they’re not. With technology today it is very easy to make a check look like it comes from any well-known legitimate company. All you need is a color printer and a trip to staples to pick up some blank checks for the printer.

But how does the fake check clear? Banks make the money available to you fairly quickly, normally 1 to 5 business days. But this doesn’t mean that the check has actually cleared. So you deposit the fake check for $1,000. It clears in your bank account 3 days later. You wire $800 cash to your employer and keep $200 cash for your pay. Then a couple of days later when the reality of depositing a fake check catches up with you your bank account takes a hit for negative $1,000 and you just broke the law for trying to pass a counterfeit check.

Here is the bottom line. There is no legitimate reason on the planet for a person who is either buying something from you or paying you for a service you have performed to over pay you by check and then have you wire the cash balance back to them. Even as I am typing this I cannot believe how crazy that sounds.

Here is my personally experience that happened with a fake check scam over 9 years ago. I applied for a freelance marketing position for a trade school in Lithuania that wanted to expand in the US. I applied to an ad on Monster so they must be legitimate I thought. I sent in my application and got an email back that they wanted me to do work for them. I did my research and the school did actually exist.  But the people I was talking to had nothing to do with the school.

They sent me a check for $25,000. Way more than what my fee was. They emailed me right away and stated that there was an accounting error. If I could deposit the check and wire the remaining cash back to them it would be greatly appreciated. When I asked “Why not just cancel the check and send me another one for the correct amount?” they came up with reasons such as legal fees, customs, etc… and that it would save them a lot of energy and money to just do it that way. But to sweeten the deal for saving them so much time and energy I could add $1,000 to my fee for the trouble. Well that just didn’t sound right to me. So I ripped up the check and never communicated with them again.

That is the best way to protect you from scams, whether it is a fake checks scam or a million other scams out there. Take a step back and ask yourself the question “Does that sound right?” If it sounds too good to be true or just doesn’t feel right, it isn’t.

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