You receive an unexpected, official-looking envelope in the mail. You cautiously open it and discover it includes a check – or, possibly even a money order – for a whopping $10,000.
You are informed that you have won $2 million in a state lottery and that you may immediately claim your winnings. Prior to doing so, though, you must pay the taxes and associated fees on your winnings in the amount of $1,500.
You may think that this is a very small price to pay – all you have to do is deposit the check or money order you received and you will be instant millionaire, right?
This is just one example of many check scams currently circulating. Instead of winning millions, you will lose thousands – and, perhaps, even your identity!
What is a Fake Check Scam?
Fake check scams occur when someone attempting to commit fraud sends an individual a check or a money order in an amount that is worth more than is owed and instructs to wire an amount in return in order to receive a lump sum amount. Once the money is sent, no money is ever returned. The following outlines the most common types of fake check scams:
- Those that offer to pay you to work from the comfort of your home
- Those that seemingly provide an “advance” on money you have won through a sweepstakes or lottery
- Those that offer to provide you with money on many millions that you will receive if you agree to transfer a certain amount to a foreign county directly to your personal bank account
What Can be Lost?
According to statistics, most victims lose up to $4,000 – sometimes, more. If you deposit the supposed monies into your bank, the bank will deduct that amount once it is deemed a counterfeit.
If you do not have enough, you could face a lawsuit or collections.
Additionally, your account may be frozen or even closed. You may be charged with check fraud and your identity may even be stolen. This could be a long, financially and emotionally devastating situation for you.
How to Detect Fraud
You must take measures to protect yourself. In fact, it is your responsibility. To date, there are no legitimate reasons for a person, business, or other type of entity to give you a check or money order and request that you send money back. The following includes important facts that you should keep in mind:
- If you win a prize, it is illegal for an entity to request payment in order to claim that prize.
- If you win a prize and must pay taxes on it, you must pay them to the government not where you won the prize.
- You will not receive a free government grant unless you applied for it. The process is often lengthy and extensive.
- Foreign country financial deals and offers are never considered to be legitimate.
- If you find a legitimate work at home job, you will not be asked to send money to perform the work.
- If you are asked to send money to an unknown entity through a money transfer, it is likely a scam.
- If you would like to learn more, you may visit the Consumer Federation of America at the following website: www.consumerfed.org/fakecheckscams
We here at Somerville can help you identify a fake check scam and other types of financial abuse.
For more information, visit one of our locations today: https://somervillebank.net/locations/