People are writing fewer checks in this era of electronic financial transactions. Despite this, fake check scams are on the rise.
Fake checks are used in a variety of frauds, from employment scams to prize and sweepstakes fraud. In all reported cases of check fraud, victims deposit the check and send money back to scammers.
Complaints to regulatory agencies and consumer watchdog groups have doubled over the last three years, have accounted for 7 percent of all incidents filed with BBB’s Scamtracker and at least one-fifth of the victims are small businesses.
A recent investigative study by BBB warns consumers, small businesses and nonprofits to be on guard against these seriously pervasive frauds and their perpetrators.
The study, Don’t Cash That Check, outlines the relevant check laws, primary victims, types of scams that use fake checks and how people can protect themselves from it.
The study data revealed many of these schemes originated outside of the United States in Nigeria and Ghana. The criminals would then use services such as Western Union or Moneygram to obtain the cash from the checks.
The U.S. loses hundreds of millions of dollars in check fraud transactions. In fact, over $789 million in check fraud transactions were recorded in 2016.
Should you receive an unexpected check in the mail, instead of cashing it, take it to your bank to have them inspect it. Keep in mind, just because the issuer appears to have an account at a bank, it doesn’t mean the check is good. A week or so later, if the check bounces, the bank will want the money back. Consumers, businesses, and nonprofits, not the fraudsters, will be on the hook for the funds and may face criminal charges for cashing a counterfeit check.
Find more information about how to avoid check fraud scams at bbb.org/avoidscams and report suspicious fraudulent activity to local law enforcement as well as scamtracker.org.
Sandra Guile is the Community Outreach Specialist for BBB. She promotes BBB’s message of marketplace ethics through public speaking engagements, presentations, media relations, press releases, web content, and other written materials. Your BBB is located at 1 East 4th Street Suite 600 Cincinnati, Ohio 45202 – to reach the office, call (513) 421-3015.
