Counterfeit Cashier’s Checks

One of the hottest fraud topics today is the counterfeit cashier’s check scam that has cheated people out of more than $25 million since February of 2003. This rip-off exploits the public’s perception that cashier’s checks are the same as cash and preys on legitimate merchants or individuals who have genuine goods for sale. The swindle takes many different forms, but the result is the same – the bad guy ends up with the money and the goods, and the victim ends up with nothing.

The scam starts with an innocent merchant or individual selling some type of tangible goods. In the case of an individual, the goods are usually big-ticket items, such as an automobile, boat, etc. In the case of a merchant, the goods are usually something high tech or high end such as stereo equipment, computers or other electronics. The merchant or individual advertises their goods for sale on an Internet site, in publications circulated around parts of the country, in the newspaper, or in other media. The stage is now set for the scam to take place.

The swindler makes contact with the seller by email or telephone and offers to purchase the item or a number of items for the asking price. The con artist will usually indicate to the seller that the goods will need to be shipped to a metropolitan area or a port city such as Baltimore for delivery overseas. During this initial contact, the con artist will offer a bogus name for himself and his company and will not offer a call back telephone number to the seller. The con artist will simply indicate that he will send payment to the seller in the mail and confirm an address where to ship the goods. After the initial contact, the seller receives an official looking cashier’s check in the mail for an amount well in excess of the amount agreed upon by them, for example $23,000 for a $2,300 item. The fraudster will now set the hook for his scam.

A short time after receiving the cashier’s check, the seller receives a telephone call from the con artist to confirm payment. When the seller tells the con artist that the amount on cashier’s check was well in excess of the agreed payment, the con artist apologizes profusely for the mistake of his accounting department and commends the seller on their honesty. The con artist then suggests to the seller that he simply deposit the cashier’s check into his bank account and send him a wire transfer for the excess. The con artist may also suggest that the seller keep a few dollars for his trouble. The seller agrees, wires the excess and ships the goods. The deal is done!

Unfortunately the seller doesn’t know that the cashier’s check is counterfeit. The seller is about to lose the money he wired to the con artist and the goods that he will ship. This scam has been linked to organized criminal groups within the United States and abroad. These groups are extremely well organized and have developed the technology to produce very authentic looking counterfeit cashier’s checks.

The general perception in the public today is that cashier’s checks are the same as cash, and the checks are seldom questioned. The counterfeits are so good it is nearly impossible for the seller’s bank to distinguish them from real cashier’s checks. The seller’s financial institution however, will soon receive the check back unpaid and regrettably, the seller will painfully realize that he has been cheated out of thousands of dollars and law enforcement can do little to help him as the con artist was careful to cover his tracks and use phony identification.

If something feels wrong to you then it probably is. If you find yourself in this situation, trust your instincts. Call our fraud department before you send money to anyone. Remember, cashier’s checks are not the same as cash and can be counterfeited. So please be patient if one of our associates questions a cashier’s check you may present to cash or for deposit. They are trained to recognize this type fraud and may prevent you from becoming the latest victim of this devious scheme.