Fake Check 411

Posted January 11th, 2021

Did someone send you a check and ask for money back? It’s probably a scam. According to the FTC, in 2019 the median loss to fake check scams was $1,988 per person. That’s a lot of money! Here’s how to catch a fake check scam and prevent it.

Here are some things that should raise red flags to you:

1. You win a prize and are told to send back taxes and fees.
2. You sold an item online and the buyer overpays.
3. you get paid as a “secret shopper” and are told to send back money.

While those situations, and many more, should raise red flags, if you ever receive a check and are asked to send back money, it is a scam.

But wait, if it’s a fake check, why does the money show in my account?

Financial Institutions have to make deposited funds available within days but discovering a fake check can take weeks. By then, you’ve already sent back some of the money so now you have to repay the financial institution for the fake check.

Just because a check has cleared, does not automatically mean it is good. This is why you should always be cautious when accepting checks.

So what can you do to prevent this type of scam?

1. Be cautious. If something seems suspicious or too good to be true, ask someone you trust or talk to your financial institution before acting.
2. Never accept a check for more than your selling price.
3. Never send money back to someone who sent you a check.
4. If you sell things online, choose an online payment service like PayPal.
5. If you spot a scam, tell the FTC (ftc.gov/complaint) so they can investigate and prevent others from getting scammed.

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