Money IQ: Sellers Beware of Cashier’s Check Fraud

Money IQ
By Fidel Gutierrez
Sellers Beware of Cashier’s Check Fraud

The old adage of “Buyer Beware” is becoming “Seller Beware” in more and more transactions especially those involving the Internet.

Cashier’s check fraud is increasing and crooks are being more creative when it comes to stealing your money.

Simply put, cashier’s check fraud is when someone gives you or sends you a “very official” looking cashier’s check and you in turn give them the item you are selling.

You then deposit the cashier’s check and at a later date, the cashier’s check is returned to your bank and your account is charged for the amount of the returned cashier’s check.

The reason the cashier’s check has been returned is because it is a counterfeit.

Many times cashier’s check fraud involves a buyer sending a seller a cashier’s check for more than the sales price or amount due.

The buyer then requests the seller to send the excess funds back to him/her – via wire transfer or Western Union. The reason given for the overpayment can be very simple.

For example: My bank made the cashier’s check out for more than I instructed them too and I need you to send me back the difference.

Criminals are becoming more creative and even placing their own ads to attract victims. This is working as many people are looking for employment and criminals are taking advantage of this fact.

The following example is a situation that recently occurred in our area. An ad was placed for an employment opportunity that stated a caregiver was needed for an elderly man in the area.

An out of state phone number was given to contact for more information and upon calling the number, the terms and conditions of the job were discussed.

The person who placed the ad needed someone to care for their father until she could relocate to the area later in the year.

The person explained that she was going to send a cashier’s check (in advance) from her father’s trust account for payment for the first three month’s salary and her father’s living expenses.

The caregiver was instructed that once she received the cashier’s check in the amount of $6,000, to send $1,000 back to the sender via wire transfer.

The reason given was that the cashier’s check was from a trust account, which allowed for quarterly disbursements and that the $1,000 was needed for some other miscellaneous care expenses (including insurance.)

The caregiver was informed that by doing this, it would allow for a proper audit trail on the trust account. Needless to say, the cashier’s check that was received by the caregiver was a counterfeit and the check was never deposited.

The person who received the check was grateful that she wasn’t “scammed,” but also disappointed that this wasn’t a legitimate employment opportunity.

Please remember, anytime someone sends you a cashier’s check and asks you to deposit it and then wire money back to them or to a third party, it is a “scam” no matter how elaborate or simple the story is for the request.

Editor’s note: Fidel Gutierrez is a Senior Vice President at Los Alamos National Bank. He has worked at LANB for 25 years.

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