The Cashier’s Check. That time-honored form of payment that was guaranteed by the issuing bank may be on the endangered list. In fact, many banks no longer have cashier’s checks, but issue “bank checks.” High technology has made it virtually impossible for a recipient to tell if a cashier’s check is real or counterfeit. Fake cashier’s checks are being used by scammers in a variety of transactions all designed to do one thing, transfer your money to their bank account.
These scams all rely on one key factor, the length of time it takes a check to “clear” the banking system. In financial transactions, clearing is the process of submitting a request for money and then having those funds transmitted to the other party. Any check, whether it’s a cashier’s check or personal check, is nothing more than a request to move money from one account to another. If you spend the money before a check clears and the check bounces, you’re still responsible for the money you spent. This is the key premise the scams rely on. Here are three popular scenarios.
Oops, we overpaid you!
A popular work-at-home scam involves the “employer” sending a cashier’s check to the “worker.” The cashier’s check will be for more than the amount you’re owed and the employer will ask that you wire the excess back to him. Be aware that if the cashier’s check bounces, you’re on the hook for any money you spent as well as the money you wired. A high percentage of work-at-home jobs are scams, so if you are ever asked to wire money by your employer, you should run, not walk, away as fast as you can.
Attention International Lottery Winners
Out of the blue, you’re contacted with the great news that you’ve won a huge sum of money in a lottery. All you have to do to collect your new nest egg is pay the taxes and/or a clearance fee in advance. The bad news? The lottery is a scam and you’re going to be out anything you pay to collect your “winnings.”
Online auctions
Online auctions can be a great way to get cash for unwanted items unless the buyer wants to pay by cashier’s check. Scammers will send a fake check and expect immediate shipment of their merchandise. A few days later, you discover the cashier’s check was a fake and your valuable items are long gone.
The bottom line is that we can kiss the days of trusting the venerable cashier’s check goodbye. Instead, opt for cash or credit card. And, if you do take a cashier’s check, wait until your bank says, “It’s cleared.” before celebrating and spending the money.
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Fake cashiers check scams — Terry Ambrose