New and Improved Counterfeit Check Scams

As long as there have been checks, there have been scams associated with them. In the “old” days it was forgery. A scam artist would get a hold of an individual’s check book, forge their signature and the victim would be left with a wiped out bank account.

In the age of technology, the scams have become more sophisticated. We rely on computers today to do everything from communicate to organize our lives. Most businesses conduct some sort of business online with their customers. Because of this, the scam artist has become more creative in their pursuit of a quick buck at the expense of someone else.

One of the latest check scams combines the old with the new. A thief will steal checks either from mailboxes or from some sort of charity or retail store. They will then proceed to steal identities from the checks.  They create these identities by fabricating driver’s licenses, credit cards and fraudulent checks. The original checks that are stolen are used to create the fake ones. With the sophistication of computers today, the phoney checks look real.  The bogus ID matches the check, and signatures match. The crook has just effectively stolen someone’s identification.

The unfortunate part of the whole scenario is that we as individuals are powerless. Most of us write checks several times a month believing that the person we are giving it to is being responsible. An example of this happens to each of us with children at school. We send a check to the school for supplies, fieldtrips, apparel, etc. The school generally does not deposit these daily. They hold onto them in a “secured” filing cabinet. Unfortunately for the parents of Loma Verde Elementary school in Novato California a break in at the school resulted in an identity theft ring obtaining the banking information off checks written to the school. Also victimized by the same ring was an investment company. All together information of over 200 people had been compromised.

The big question is how do we protect ourselves from becoming the next victim? One of the best ways to ensure that your check cannot be used to reproduce your account is to use only your first initial and last name on your checks. If stolen, the thief will not know your full name and have difficulty knowing what the initial stands for. “J. Smith” can be John, Joseph, Judy, or Julie.  Monitoring your account online will enable you to spot any fraudulent activities within your account quickly. Your bank may also offer you fraud alerts. If it does, sign up for that.

Make sure you don’t unintentionally contribute to these types of scams by cashing the phoney checks.  One state is combating this type of crime. The office of the Attorney General of New Mexico has created a database to help consumers identify counterfeit checks.  The process of checking the check is relatively simple. By visiting the website of the New Mexico Attorney General, individuals can simply input the bank, routing number and account name and then look up if that information has been registered as counterfeit.

Since many counterfeit checks come from fake lottery or sweepstakes winnings, the best way to ensure you are not contributing to a scam is not to be sucked into it in the first place. If you receive a check from someone you do not know, and are asked to cash the check, keep a portion and send a wire to the individual, save yourself the headache and ignore it!