Working in the fraud department of a bank for seven years, the most hateful part of my job was calling someone and telling them that the check they deposited was counterfeit. It’s especially hard when the customer wired money through Western Union. A lot of customers are under the impression that the FDIC Insurance the bank advertises protects the customer against fraud. That is not the case. FDIC Insurance protects the customer if the bank fails. To be protected against fraud, it would be the customer’s responsibility to obtain insurance on their own.
How can you determine if the check is valid or fake? Sometimes it’s hard. You might have to do some research on your own. First thing to do is figure out the scenario on why you received the check. Here are just a few scenarios:
~You receive an e-mail or phone call by someone stating you won the Italian lottery. They have a check made out to you for millions of American dollars. However, in order or you to receive these funds, you have to pay foreign transaction fees. Don’t worry because Italian lottery will send you a check for $4,500. Deposit this cashier’s check and once the funds are available, withdrawal the cash and wire it through Western Union.
~ You receive an e-mail about a foreign company looking for bookkeepers. They need someone in the states that receive payment checks for the company from clients this company has in the United States. You are to deposit these checks, wait for them to become available, wire the funds through Western Union less 10%. You get to keep 10% for commission. Easy money right?
~You want to earn extra money doing part time work. You browse through the job banks online and find a mystery shopping job. You apply; receive a check in the mail for $4,500 with instructions that tell you to deposit the check. Then go to this store and spend this much of the money, that store and this much of the money, eat at this restaurant and that restaurant. The last thing is to wire the rest of the money through Western Union. Fill out a questionnaire on all the stores and restaurants, and even Western Union.
Ask yourself how you received the check. Usually these checks are sent through Fed-Ex or UPS. Check the return address. If the return address is in the states (which most of the time they are, and they are fake addresses) but it was supposed to be for the Italian lottery, or from a business then chances are it is fraudulent.
Next, replay the conversation in your head. Please do not tell anyone you won the lottery, or you need to make a decision on whether you want this job in the next three seconds or we are going to have to give it to someone else. They don’t want you to tell anyone because they don’t want people to tell you that it is a scam. They also put pressure on you because they don’t want to give you time to think. If it were a legitimate job offer, they would understand if you wanted a couple days to think about the offer.
Also consider why the person sending you the check is so adamant on the funds being wired through Western Union. You go to Western Union, fill out the paper work of who you are and where you are sending the money. The transfer happens. On the other end, John Doe is coming in with identification confirming who he is; he gets the cash and walks out. The trail ends. However, if you wire the funds through your financial institution, not only do you get to pay a heftier fee, you can trace the funds a little better. You have to provide the bank with the account number you want the funds to be deposited into. The funds will be wired to another financial institution. Then the receiving bank will deposit it into the account number you provided.
If you are still unsure, ask the representative at the bank. If they question you where the check came from, be honest. Nine times out of ten, they are trying to be helpful. If the representative doesn’t know you could deposit the check, but don’t spend the money even if the funds become available. Wait a while. However, if you are like me and don’t have the willpower to see money in your account and not spend it, that may not be an option. Usually, when receiving a bank check, you will be expecting it. If not, there is an explanation accompanying the check like overpayment on an account.