Fake checks are one of the most common means for scammers to trick you into sending them money. Here's how they do it: They send you a phony check for a "legitimate" reason, such as paying you for an item you're selling online. But, they overpay and have you wire them the excess funds. Their check turns out to be bad, meaning you're in the red. Another scenario is you're informed that you've won a contest, and you receive an "advance" on it, but you have to pay "fees" and/or "taxes" in order to claim it.
Be Alert – Watch Out For Fake Checks From Fraudsters
These situations can be tricky because the check may clear after you deposit it. But that doesn't mean it's good, and when your bank finds out, you're the one on the hook to pay that money back.
Use these tips to avoid falling prey to check scams.
If you think you've been a victim of this type of scam, quickly alert your bank as well as the bank that supposedly issued the check. You can also alert the Federal Trade Commission at ftc.gov/complaint.
- If you sell something online:
- Only accept money orders, cash, or other secure forms of payment.
- Consider using an escrow or online payment service.
- Never take a check for more than your selling price.
- Have your banker examine checks from unknown sources before you deposit them.
- There is no legitimate reason for anyone to ask you to send them money when they're supposedly paying you, so always refuse to do so.
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