Friday, June 26, 2009

Overpayment-Refund Check Scam

Also known as the Cashier's Check Scam, the latest iteration is slightly more sophisticated than predecessors.

Here's how it happens:

  1. You advertise something for sale. It could be an item or a service. You advertise it on the internet, usually somewhere with no ID checking capacity, such as craigslist.
  2. A potential buyer contacts you and expresses interest in your offer.
  3. The buyer explains that they will provide a cashiers check or corporate check to pay in full.
  4. To put you at ease, the buyer gives you all of the details of the cashiers check, or of the corporation and its corporate check on the way.
  5. If you call the issuing bank to confirm the validity of the check, it may be validated. This only means that the check bears a real account number, routing number, and matching issuer name.
  6. The buyer then tells you they have sent, or are sending an amount greater than the price of your offering. The overpayment, and that they need you to send the difference back to them, or pay it to a person affiliated with them, such as a son or daughter in your local area.
  7. The check arrives as promised, for a larger amount than required.
  8. You deposit the check as expected.
  9. You wait for the check to clear. It does.
  10. You refund the overpayment to the buyer.
  11. The check later is returned by your bank, leaving your without the funds you sent to the buyer as overypayment.
  12. The buyer is nowhere to be found.

What happened?

  1. The "buyer" is a scammer, who had obtained the information on the check provided by copying it from an actual check, viewed by the scammer at sompoint.
  2. The scammer then goes fishing for anyone who will accept the check of an overpayment.
  3. With a "mark" in his sites, the scammer then forges the check or cashier's check. This is easily done with standard desktop publishing.
  4. When you deposit the check, it clears the account of the unsuspecting owner of the account.
  5. The company on who's bank account the check was drawn (the "maker") reports the fraudulend check to their bank.
  6. The maker's bank retracts the payment, charging your bank for the amount cashed. Your bank then charges you.

1 comment:

  1. They just keep coming!