North Carolina Department of Justice

North Carolina Department of Justice

North Carolina Department of Justice
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Don't bank on phony checks

6/4/2009

By Attorney General Roy Cooper

Promises of easy money can be tempting, especially during these tough times.   Who wouldn’t be happy to get a check for thousands of dollars in the mail? But if the check comes with instructions to cash it and then wire money overseas, don’t bank on it.
 
Counterfeit check scams can start with an official-looking letter, a call from a telemarketer, a job offer, or a response to something you’ve posted online, like a resume or an item for sale. There are three main types of counterfeit check scams to watch out for:
 
Sweepstakes Scams
The classic counterfeit check scam starts with the news that you’ve just won an unexpected prize of as much as $950,000. Along with the announcement comes a very legitimate looking counterfeit check that’s supposed to cover taxes and fees on the prize. You’re instructed to deposit the check and then wire the money back to the sweepstakes in order to claim your winnings. After you send the money, the check turns out to be a fake—but the scammer already has your money.
 
Secret Shopper and Payment Processor Scams
One recent kind of counterfeit check scam starts with an advertisement in the newspaper or on the Internet or a telemarketing call or email promising well-paid work as a secret or mystery shopper. If you respond, you’ll get a check to deposit and instructions to wire the money back as a way to evaluate the wire service company. 
 
A related scheme claims to offer work as a payment processor for an overseas company. Consumers who respond are sent money orders or checks to deposit and then asked to wire the funds back to the company. In exchange, they’re promised 10 percent of the money
 
Overpayment Scams
In yet another type of counterfeit check scam, scammers respond to people who’ve posted items for sale on legitimate websites such as Ebay and Craig’s List. They claim to be interested in buying the item, then send a certified check for more than the purchase price and ask the seller to wire back the extra money. 
 
In all of these scenarios, the check turns out to be fake, meaning that any money you’ve wired comes out of your own pocket. Some of these scammers also ask for sensitive financial information to “verify” their winnings and then use the information to commit identity theft.

While scams like these have been popular with international fraud rings for years, advances in printing technology mean that crooks can now make very convincing counterfeit checks. Sometimes, the scammers even send along fraud warnings and consumer protection brochures to make their phony checks more believable. 
 
Even banks have a hard time spotting these fake checks because they often use the name and account number of a legitimate company.  It can take weeks for the check to be discovered as phony, usually not until the real company named on the fake check spots it as a counterfeit.
 
In the past year my office has heard from hundreds of North Carolinians about counterfeit checks. Sometimes we’re able to help consumers before they become a victim. For example, a woman in western North Carolina almost wired $30,000 to scammers in Holland who had sent her counterfeit checks.  Fortunately her bank caught onto the scam and persuaded her to call my office instead. 
 
Not all consumers are so lucky. Unfortunately, these scam artists’ fake checks sometimes find real victims in North Carolina who lose thousands of dollars. Here are some warning signs that the check you got in the mail is a fake:
 
  • You’ve been told that you’ve won a lottery called “El Mundo,” “El Gordo” or from a foreign country such as Canada, Costa Rica or Australia.
  • You’re told to wire, send, or ship money immediately to a large U.S. city or abroad, especially to England, Canada, or Nigeria.
  • You’ve posted an item for sale online and receive a check for more than your asking price.
  • You’re told that you can receive a commission for transferring money through your account.
  • You get an email or telephone request to confirm, update or provide your personal account information.
 
If you receive what may be a counterfeit check or get a call or letter claiming that you’ve won a phony lottery, don’t respond.   Instead, report the scam to my office by calling 1-877-5-NO-SCAM toll-free within North Carolina. 
 
We’ve helped negotiate national agreements with Western Union and MoneyGram to make it harder for fraud artists to use wire services to steal your money. We’re working with law enforcement across the country and around the world to investigate fraud rings, and we’re also working to raise consumers’ and bank employees’ awareness about these scams.
 
Attorney General Roy Cooper and his staff are on the lookout for scams that seek to rob unsuspecting North Carolinians. We are here to be of service when you need us, but through consumer education efforts like these columns we hope to help consumers avoid problems from the start.