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Beware of Check Payment Scams

How the Scam Works

A scam artist may claim that he/she wants to purchase something from a potential victim. Fraudulent operators often contact a consumer or organization through the Internet, although they may also establish contact by phone or fax. Once a price is agreed on, the scam artist sends a personal or cashiers check to the seller in excess of the purchase amount, requesting that the excess payment be returned or sent to a supposed third party. Sellers then typically cash the check and make the payment to the scam artist before discovering that the check was fraudulent. Victims of such fraud can be bilked out of thousands of dollars. Furthermore, it can be difficult for law enforcement agencies to track down such perpetrators, leaving victims with little recourse or hope of recovering their money. Prevention is the best protection against such scams.

Tips to Avoid Internet/Cashiers Check Scams:

1) Question payments made by cashiers check. Some consumers readily accept checks that look like cashiers checks, thinking their money is safe. Even though banks may make money readily available to a customer upon cashing a look-alike cashiers check, the check may not be authentic. Checks generally must be sent to the issuing bank before payment is authenticated, a process which can take several days or weeks.
2) Contact the bank or financial institution that the check (whether regular or cashiers) is drawn from to determine whether the payment is legitimate or a fake. Do not use the contact information that appears on the check, which may be forged to misdirect potential fraud victims. Instead, obtain such contact information independently, through legitimate directories or other sources.
3) Don't be tricked into sending payments to fraudulent actors. If a third-party is actually owed a commission, their client should be the party making the payment.
4) Don't be rushed. People often make poor decisions when they are hurried. If someone really wants to do business with you, they will wait until you are ready to make a legitimate transaction. Furthermore, if an individual wishes to make changes to the terms of the transaction, such as where the payment is sent, do not let your eagerness to complete the transaction blind you to potential problems.
5) Know where you are sending money. If you send payments to foreign countries, law enforcement agencies may lack effective oversight to pursue criminals there.
6) Be on guard against offers that include checks or other payments from overseas.
7) Consider using a secure escrow payment service of your choosing when doing business online. Many online auction companies offer such a service for a low fee. Question demands that you use an escrow payment service you are unfamiliar with, or other unusual payment requests.

Concerns about Counterfeit Check Payments or Other Internet Scams?

Contact the following agencies:

Federal Bureau of Investigation
Minneapolis Office
111 Washington Avenue South, Suite 1100
Minneapolis, MN 55401
(612) 376-3200

Federal Trade Commission
Consumer Response Center
600 Pennsylvania Avenue, NW
Washington, D.C. 20580

United States Secret Service
Minneapolis Field Office
300 S. 4th St., Suite 750
Minneapolis, MN 55415
(612) 348-1800

Federal Insurance Deposit Corporation
FDIC Special Activities Section
550 17th Street, NW
Room F-4040
Washington, D.C. 20429

Office of Minnesota Attorney General Mike Hatch
1400 NCL Tower
445 Minnesota Street
St. Paul, MN 55101
(651) 296-3353
TTY: (651) 297-7206
TTY: 1-800-366-4812

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