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Arm Yourself Against Fake Check Scams

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Fake check scammers never rest. They actively look for ways to victimize people. And too many unsuspecting people fall for it, losing money to their multi-billion-dollar schemes. The only way to avoid becoming one of the victims is to learn to recognize and avoid such scams.

Fake checks look real, often real enough to fool bank personnel. Phony cashier’s checks or those designed to look like they are from real businesses often are actually “dummied up” copies of legitimate checks, created without the knowledge of the companies.

The National Consumers League Internet Fraud Watch offers these suggestions to help you in your effort to stay scam-free:

Beware of any transaction in which you are asked to pay by check with the guarantee that some of the money will be wired back to you. Chances are you’re walking into a scam.

There are many variations on the ploy. Someone may offer to buy something you have advertised for sale. They may offer to pay you to do work at home. They may hold out the promise of an “advance” on a sweepstakes you have purportedly won. They may offer to pay the first installment on promised millions that you’ll receive for allowing a party to transfer money from a foreign country to your bank “for safekeeping.” The pitches are many and they all sound feasible.

Scammers have methods of finding potential victims. They check newspaper and online advertisements for personal listings of items for sale. They look at online job sites to find people seeking employment. They place ads with phone numbers and/or email addresses so people can contact them. They may even send emails or faxes at random, expecting that some recipients will be gullible enough to swallow their bait. Claiming to be in a different country, a scammer may tell you that making a transaction internationally is too complicated. They promise that someone in the United States will send you a check. Don’t believe it.

Or they may try to involve a third party, saying this third person owes them money and they will have that individual pay you for what they have purchased. They dangle the promise that the check from this third person will exceed the sale price of the merchandise. They ask that you deposit this third party check, keep what is owed for the merchandise and wire the balance to them.

If you have agreed to work at home, the scammer may claim you’ll be processing checks from “clients.” They want you to deposit these checks and wire them the money after subtracting your pay. Another twist is for the scammer to “overpay” you “by mistake” and ask that you return the excess. Either way, you have lost. The sweepstakes and foreign money variations often include a request of money for taxes, customs charges, bonding fees or legal costs, which would seem feasible if the transaction were legitimate.

Under federal law, banks must make funds available to you shortly after deposit — one to five days in most instances — so you may be able to draw on fake checks very soon. But if it’s a fake check, the responsibility rests with you, just as if it were bona fide. You most likely will be informed that there is no substance behind the check you deposited and the amount will be subtracted from your balance. The process could take several weeks, but the result is inevitable. The financial institution relies on depositors to determine the risk of what they deposit. If a check is no good and the account does not contain enough to cover it, the institution my take money from your other accounts to make it good, or expect you to make up the difference.

It is not unheard of for law enforcement to bring charges against the victim because there is every appearance that they have defrauded the bank. This is the ultimate double-whammy.

The bottom line, according to the Consumer League’s guidelines, is that there is NEVER a legitimate reason for anyone with whom you are dealing to ask you to wire money back to them. If you are selling something or providing a service for someone you do not know, insist on a cashier’s check for the exact amount involved, preferably from a local bank or one that has a branch in your area.
Do not deposit a check if you believe it is fake. Report it to NCL’s Fraud Center, www.fraud.org. The information will be forwarded to the appropriate law enforcement agency.

Customize Your Personal Checks

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Personal checks can be customized  any way you like. They don’t have to be plain. Check printing companies offer a variety of ways to put your own imprint on those checks, so that you can create checks that meet your particular needs or desires.

The thing to do is compare. The options may vary, including such things as choice of designs, personal message lines, one-time offers of a few personal checks or a free box with the second at a reduced price. Be aware that some check printing businesses offer these options only to first-time customers. Look around and evaluate such things as the number of personal checks and the terms of the transaction, designs and shipping costs.  Then compare the variables to determine which appeals most to you. Some companies may offer free recycled checks or duplicates to entice you into an upgrade. Some require a coupon code, so make sure if you have such a code that it is still valid.

Follow these steps to complete your process:

1. Select a design. Companies will vary in how many designs they offer that you can choose among, ranging anywhere from four to 25.  If the special you choose includes a second box free, you’ll be set for a long time.

2. Select lettering styles. Some companies may throw in a monogram or symbol next to your name and address or add a personal message line gratis.

3. Be certain of the status of a register to keep a record of checks. If the deal you opt for does not include a register, you may want to add one to your shopping cart.
If you love the design you chose, consider coordinating with other items such as address books or labels to extend the effect.

4. When your check order arrives, be certain to look at the invoice to ensure that the fees and terms are what you agreed to. If you are certain everything is as it should be, submit your payment.

5. Print a copy of the invoice so you have a record of all the shipping terms, estimated shipping dates and customer service number just in case a question should arise after the fact. A printed copy is easier to access if it is required than having to look up the details online if references are needed later.

Personalizing your checks can be fun and rewarding. There is such a wide range of designs and photos that appeal to almost any age, women, men and young buyers.

Check writing not going out of style

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Although a pocket full of plastic has become the norm for many Americans when they shop and pay bills, the online sales of personal checks show that writing checks remains a very viable option for millions, the experts at coolchecks.net say. In fact, the country’s two largest producers of personal and business checks posted revenues in the hundreds of millions of dollars from sales in 2009. Obviously, it is too soon to say that credit and debit cards have nudged checks entirely out of the picture. Companies such as coolchecks.net are nowhere near ready to throw in the towel and they continue to provide a wide choice for those individuals and companies that find checks the best way to do business.

The 2009 annual report from Deluxe Corporation showed that more than 63 percent of its $1.3 billion in revenues came from the sale of checks. And Harland Clarke noted that 72 percent of its $1.2 billion in revenues was related to checks and other personal items. The Federal Reserve estimates that some 33 billion checks are written in this country every year—no small number.

There is evidence that Americans, dealing with a depressed economy, are now paying the price for over-use of credit cards They have racked up more than $1 trillion in such debt, a 25 percent increase in the past five years., the Federal Reserve reports. The experts predict that a return to personal checks may be one solution to this trend. The tendency to make a flip-of-the-wrist credit card purchase may be cooled by the necessity of actually writing the amount of the purchase on a piece of paper, they say. The immediacy of the deal cancels out that false sense that “I don’t have to pay until later” that accompanies a credit purchase. Many people find a canceled check to be a more tangible method of keeping track of finances.

And if checks online are your choice, they should say something about you. Being able to make a personal statement with every use is one of the good reasons to use checks. Coolchecks.net has hundreds of designs ranging from the simply classic to the Disney whimsical, with nature, hobbies and personal interests in between. And they come at prices that are up to half what a bank would charge. Check us out.

Switching banks? Take your time

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If you’re one of those who are determined to switch banks, beware. Breaking up can be hard to do.

Since the call went out recently from people involved in the Occupy Wall Street movement and other efforts to rein in the country’s big banks, thousands have shifted their funds into alternative financial mangers, including credit unions, community banks, saving and loans and others. There is some indication that the big banks are paying attention to the unrest spreading through the country. Some have backed away from announced fee increases. Even so, the momentum for expressing disfavor with one’s bank by marching to another is under way. The date set by the Occupy group is Nov. 5, but don’t hurry just to meet that arbitrary date.

A spokesman for Institutional Risk Analytics reported that banks in more than 16,000 American zip codes — more than half of those in the country have been subject to recent online searches. That could be bad news for the largest banks, but is it enough to spur real changes in how they treat customers? Time will tell. As of 2009, four banks — Citigroup, JPMorganChase, Bank of America and Wells Fargo — held 39 percent of all deposits in FDIC-insured banks, according to Reuters. The options for getting out of one of those monsters into something more user-friendly are many. American Bankers Association reports more than 8,000 other banks and 7,600 federally insured credit unions to choose among.

But move cautiously. In 2008 the Federal Reserve published a study that indicated that trying to leave one bank and go to another may be a mere exercise in “switching costs.” The researchers found it was incredibly difficult for consumers to get reliable information about the costs charged by the new bank. They described a “bargains-then-rip-off strategy” in which the free toaster offered for enrolling is followed by an avalanche of previously unspecified fees. Often, the report says, the prospective bank will not even make information about fees available to new customers. The data is not listed on Web sites and comparison shopping is almost impossible. Some credit unions are providing “switch kits” to help in those considering a change, but in general the kits can do little more than identify differences in payments and deposits. In the end, switching banks means swimming through the red tape.

In some instances, credit unions charge fees that compare with those charged by the bigger banks. But they tend to have credit card rates that are lower — one full percentage point lower on average. Their car loans carry lower interest, but one-year CD rates and mortgage rates tend to be higher than at banks. Community banks tout community ownership as one of their pluses. A familiar face across the counter counts, they say.

Regardless of the direction your own study takes you, reduce the potential trauma of a switch by following these tips from Consumer Action:

Expect the switch to take some time. Initially, keep your original account open while setting up the new account, putting only as much into the new account as required to maintain it. If you have paperless banking, print or save statements and digital copies of canceled checks as PDFs or it may become difficult to access those documents after the fact. Order new checks (they’re cheaper from outside sources than through the bank itself) deposit slips and ATM cards from the new institution being aware they make take some time to arrive. Only when the new account is established should you transfer automatic or recurring payments from the old account. Don’t overlap. Be sure all outstanding items are cleared before closing the old account. Keep your user names and passwords on hand to smooth any sticky spots. Review several months of statements from the old bank to be be certain you haven’t missed anything such as utility or insurance payments that are authorized for automatic withdrawal bimonthly or quarterly. Be certain your old bank has your current contact information to facilitate any loose ends or slip-ups that occur in the transfer.

Occupy Movement Concerns

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At this point, no one knows what effect, if any, the Occupy movement will have, ultimately, on the American economy. But the effort that was planted in Wall Street has sent off shoots that are bearing indignant fruits in all corners of this country, and even in countries beyond our borders. The determination to catch the attention of those who make things happen clearly manifests a growing undercurrent of dissatisfaction at the bottom end of the feeding trough. Those who have been left devastated by the effects of a prolonged recession are ticked. They’ve watched their own incomes disappear into the unemployment quagmire or get skinnier while some of the huge institutions that came palms-up for taxpayer help chalked up enormous profits and handed out hefty bonuses to those at the top. The protesters are screaming “No fair!” with good reason.

Bankers claim they should not be the focal point for the money-based class warfare that is brewing. And they may be right. Dozens of factors have played into the current money mess in America. But many Americans meet the reality of their tightening circumstances at the door to their banks. And the banks have not done much to give the impression that they are sympathetic to their neediest clients. When Congress capped the amount banks can charge merchants for debit card usage at about 24 cents per transaction, that might have helped, since the average fee had been about 44 cents per transaction. But instead of heeding the obvious direction Congress wanted them to pursue, many in the banking industry responded by adding monthly fees for debit card users. Increased fees for the use of credit cards and ATMs have added salt to the wounds of many. To demand that a client maintain a hefty (for him) balance while his home is being repossessed smacks of Scroogism at its worst, the protesters say. The banks justify fee increases by pointing to the “building a banking stop on every corner” approach they’ve adopted. Ready availability has its costs, too, they argue.

The end of the Occupy movement is nowhere in sight. Spontaneous groups are still emerging to shore up the earliest protesters and there are no signs that anyone is ready to quietly tuck in his tail and abandon the fray.

One of the ways the “have-nots” are showing the depth of their angst is encouraging people to take their funds out of banks and deposit it in other financial institutions. Credit unions all over the country are reporting significant membership increases. Occupy promoters have even set a day – Nov. 5 -– which they have dubbed Bank Transfer Day on which they hope many Americans will do just that. Whether your own concern rises to that level or not, there are things you can do to avoid unnecessary costs related to bank use. Up front, be aware of any fees you are being charged. Avoid triggering those fees whenever you can. Shop with cash and consolidate buying when you can to avoid individual fees on many purchases. Don’t pay the bank for providing personal or business checks. There are companies that will charge you up to 50 percent less.

Over the course of the upcoming election year, the debates will be become hot and heavy. Maybe the Occupy effort will be just a historical blip on the ongoing effort to redirect America. But it has raised awareness that a growing number of its citizens are not happy with the status quo.