A new fraud, the cashier's check or "advance fee" fraud has become more prevalent as online auction sites and classified ads have gained popularity. In many cases, large ticket items lure this type of fraud artist to a victim.
The typical fraud scenario is somewhat confusing, which is probably one of the reasons why the fraud artist is successful.
Let's say you post an ad for your car on an online auction Web site for $3,000. A buyer bids on the car for the full asking price. When payment is arranged the buyer says there is someone who owes him money. The person who owes the buyer money offers to send you a cashier's check for $5,000 and asks that you wire back the difference to the buyer. You agree because they offer you a small commission for brokering the deal. You receive the counterfeit cashier's check, deposit it, and because legitimate cashier's checks are thought to be as good as cash, wire the leftover sum to the buyer. Ten days later your credit union informs you that the cashier's check was fraudulent and that you're responsible for any money you've drawn against it. Unfortunately, you've lost your money and merchandise to a scam. There are variations on the scheme as well.
Consumer Tips
The United States Senate Federal Credit Union offers the following tips to protect consumers from cashier's check and "advance fee" fraud schemes:
Beware if the buyer or seller asks you to send money quickly. It often takes 10 days or more to determine if a cashier's check is counterfeit. Do not ship the goods or spend any of the funds sent to you until at least 10 days to two weeks after you deposit the cashier's check.
Insist on a cashier's check drawn on a local institution, or has a local branch. Insist on a cashier's check for the exact amount.
Check to make sure the financial institution is legitimate. If you have doubts ask us to verify.
These fraud artists tend to target vulnerable people, senior citizens and young adults. Alert any family members who may be at risk.
No legitimate company will offer to pay you by arranging to send you a check and asking you to wire some of the money back. If that's the pitch, it's a scam.
Become familiar with any auction site you visit online. Find out what protections the auction site offers buyers and sellers. Don't assume the rules are standard for all auction sites.
Find out as much as you can about the other party you're dealing with on an online auction site. Be wary of those who try to lure you away from the Web site with promises of a better deal.
Save all transaction information.
Protect your privacy. Never provide your Social Security number, driver's license number, credit card number or account information.
Never agree to travel to meet your buyer or seller.
REMEMBER YOU ARE THE ONE WHO IS RECEIVING THE PROCEEDS FROM THE Cashiers/Official check and you are the one who the Credit Union will be looking to collect the money from if the Cashiers/Official Check is counterfeit. If you have any reason to suspect that the Cashier/Official check may be counterfeit let us know now and we may be able to help.
