Fake Check Check Fraud
This scam involves a seller advertising a valuable item over the Internet. A "buyer, or buyer's agent" often from a foreign country, contacts the seller about purchasing the item and states that he plans to use a cashier's check or regular check issued from a bank/credit union in the United States. Then the "buyer" tells the seller that he either "mistakenly" sent too large a check, or that he will be sending a check for more than the purchase price. In either event, the seller is instructed to immediately wire the "balance" back to the buyer, through services such as Western Union or MoneyGram, which you can send from WalMart.. Not even the FBI can trace a wire transfer as you can pick it up anywhere in the state.
Under a federal banking law, the customer's bank is required to make those funds available to its customer on the business day after the funds are deposited. So, the deposit shows up in the sellers bank account they are able to withdraw the "overpayment" before the check winds its way back to the bank that supposedly issued it (since it is fraudulent). The cashiers check is either cancelled or was a counterfeit check from a defunct branch of a bank. That can take 7 days, or even longer. Of course, after wiring the money back to the buyer, the scam artist is nowhere to be found.
Some checks may appear to be from a US bank but, upon closer inspection, include foreign country or city names. We had one from a U.S. Bank (National City Bank, a regional bank in the east for a rental in Calif. I assume so it will take longer to clear) The check had been voided. The address of the person the funds were to wired to was fake.
According to FTC officials, the scams work like this: Someone responds to your posting or ad, and offers to use a cashier's check, personal check or corporate check to pay for the item you're selling. At the last minute, the so-called buyer (or the buyer's "agent") comes up with a reason for writing the check for more than the purchase price, and asks you to wire back the difference after you deposit the check. You deposit the check and wire the funds back to the "buyers." Later, the check bounces, leaving you liable for the entire amount.
About/scams at CraigsList.org says:
FAKE CASHIER CHECKS & MONEY ORDERS ARE COMMON, and BANKS WILL CASH THEM AND THEN HOLD YOU RESPONSIBLE when the fake is discovered weeks later.
ScamAlert at rentals.com says:
Please be aware of an internet scam that some of our customers have encountered. A potential tenant will overpay you a large sum of money in the form of a cashier's check, and ask for the difference back. Do not send any money; the check is fake. If you have any questions about this or other questionable activities, please call our customer service center at 1-888-501-7368.
FAQ at VacationsFRBO.com says:
The general advice we have for all parties is to try to pay and accept payment via a credit card or PayPal, as these give you some dispute recourse.
Searching Google for "landlord credit checks", for instance, will return multiple websites that charge roughly $10 to $20 for basic information.
Owners and renters should insist on a written contract that is clear and contains the names, addresses and phone numbers of both parties. We recommend proceeding with caution where either party insists on payment via a money order, bank transfer or cashier's check that cannot be verified or traced.
Do not ever accept a cashier's check in excess of the required amount where the "excess funds" are requested to be sent to the payer, as this is a common scam.
And always keep in mind the old adage that if it seems too good to be true, it probably is.
Overpay Alert Guidelines at: ftc.gov
The FTC gives the following tips to avoid check overpayment scams:
You can sidestep would-be scammers by following these common-sense rules: