How to Protect against Cashier’s Check Fraud
As discussed in a previous article on the Facts of Cashier’s Check Fraud, consumers are often taken advantage of the fact that they trust a cashier’s check to be legitimate. These cashier’s checks are used to steal goods or services, or to scam consumers into cashing the checks and wiring a “fee” portion of their check to a third party. Once the check has been deemed “fraudulent” by the bank, the money is then reversed in the consumer’s bank accounts. This often leaves the consumer with less money than they originally started and often without the goods they sold. It is important as a consumer to know how to avoid this type of scam and ensure that when someone pays you with a cashier’s check it is legitimate.
Be Cautious
-Be wary of customers or companies that request you provide the goods before payment can be verified.
-If an individual or company requests that you wire a portion of money to a third party, be suspicious.
-When requested to wire a “processing fee” to a third party as part of your lottery winnings, be suspicious.
-Never pay for a free gift or prize that you have won, this includes shipping.
-Always document any type of payment you receive or make in case you ever have to appear in court.
Ways to Avoid Cashier’s Check Fraud
As a consumer, cashier’s check fraud can be a threat on your identity and your way of life. When dealing with cashier’s checks a consumer should always keep the following in the back of their mind:
-Know who you are in business with. Verify information about the buyer or company offering you money prior to cashing their check. Always be cautious of cashing checks from anyone you do not know – including cashier’s checks.
-If you are selling your goods or services online, do not accept cashier’s checks as payments. Instead look into payments such as credit cards or escrow payments.
-Never take checks that are paid out to more than the buyer owes to your company and never wire remaining funds to a third party.
-If a company or individual insists on paying in a cashier’s check, as for them to draw it upon a local branch within your area so that you can verify its legitimacy immediately.
-Know how long your bank will take to legitimately clear a check rather than make funds available.
Resources:
Avoiding Cashier’s Check Fraud, www.occ.gov, November 29, 2010, http://www.occ.gov/news-issuances/consumer-advisories/2007/consumer-advisory-2007-1.html