How To Avoid Check Scams

Hard-working, trusting people like you are fooled by criminals and con artists using fake checks all the time. Check scams and counterfeit checks are two of the most popular tactics use by criminals to cheat people out of their money.

Some take your phone number and address from a newspaper classified advertisement, others email you letters full of lies, or even try to trick you on sites like Facebook.

We tend to assume that it's mostly senior citizens who become prey to these types of crimes. But stay at home mothers, college students and many others are also targets of check scams.

Personal checks and money orders you cash or deposit are accepted by the bank base on your ID. Financial institutions and check cashing stores don't have any information telling them where the check came from. You should realize that when you cash checks, you are taking all the risk on your own shoulder. You will be held responsible if the check turns out to be a fake.

The National Consumers League reports that most victims in a check scam will be bilked out of $3,000 to $4,000 on average. That seems like a major financial setback for almost anybody. Not to mention, your unwilling participation in a check scam could mean you lose your checking account, are denied the right to open a new one, and could seriously damage your credit score.

Here are some of the most used fake check scams. Learn to recognize them so that you never get tricked by a low-life.

Congratulations! You're the lucky winner of a big cash prize and you didn't even know it!

Sweepstakes, lottery schemes and special grants are a good example of scams involving fake checks. It's hard not to respond to this type of a scam. Everyone wants to win big. The scammers may even use the name of a recognizable sweepstakes company or they say you won the lottery in another country.

All you have to do is cash a check, wire them some of the money and wait for the rest.

Here's the problem: Genuine sweepstakes companies will never contact you by email or regular mail. An actual business would use certified mail in a situation like this. Plus you'd never be asked to pay a fee to get your prize. Not to mention, it seems quite strange to win a contest you never even entered. And why would an organization that gives away grant money give it to you if you never even asked?

Apparently you have a long lost relative whom you've never met, and good old Uncle Charlie left you a nice sum of money as an inheritance!

You probably received an email or letter asking you to first cash a couple of very convincing business checks and send some of the money back to pay taxes on your new inheritance.

Here's the problem: You pay taxes directly to the government not to a company. Plus, if Uncle Charlie liked you so much, how come you've never met him?

Someone you're working with tells you they accidentally sent more than what they actually owe you. Or maybe they want to pay you with a check from someone who owes them money - and they want you to wire them the difference.

Here's the problem: A legit buyer should be more than willing to send you a personal check with the exact amount owed, and there's no reason a different person should send a payment. Even if the potential buyer claims to be from another country - and is having difficulty with currency differences - it should not be impossible to send money electronically from practically any country.

Keep in mind that if you deal with someone directly instead of through the online auction website where you posted an item for sale, you'll lose any protection that site may have offered.

Someone contacts you saying they're having a medical emergency or they're stranded somewhere with children and desperately require assistance. For whatever reason, they want you to cash a personal check and send the cash back to them. Maybe it even comes from the email address of someone you know personally.

Here's the problem: These are by far the dirtiest types of check scams. They make victims out of folks who have the best intentions. Realize that it is possible for hackers to gain control of personal emails and use them for scams. When you get a strange sounding email or letter from someone you know - try to contact them before giving away any of your money.

The next scumbags are some of the most common types of scammers who use checks and money orders. A foreign dignitary needs your help transferring a large sum of money from their country to your bank account. Or maybe a crook will tell you they got the money illegally and that's why they have to do things secretly.

Here's the problem: Ask yourself some common sense questions. Ask yourself - why a rich foreign ruler would ask for your help anyway? You'd think they could hire someone to help with their financial issues? If they got the money illegally, why would you trust someone who already confesses to be a crook?

It seems like a great job offer. Lots of money and you'll hardly need to work. All they want you to do is deposit checks in your account, send some money to them and keep some for yourself. Maybe they want you to be a "mystery shopper." Just buy a couple of things with the money from these business checks and send the rest back to them.

Here's the problem: A legitimate business would not work this way. If you are offered a job and you never even filled out an application - it's probably a trick. Don't you think a real employer would probably want a background check or at least an interview before they hired you.

You've probably noticed some common themes in all of these scams.

One is that they're all offers that are too good to be true.

The other is asking the mark to send the funds from a fake check that was cashed. That's the biggest give away! When someone want you to conduct business they should do themselves - there's a good chance you're being scammed.

It is perfectly safe to use business and personal checks in your day to day life. Just remember to keep your eyes peeled for the various schemes used to abuse the check payment system.