4 Common Cashier’s Check Fraud Scams

Cashier’s checks are commonly used for large, expensive purchases (such as a car or house sale) because they have more security than a personal check. Cashier’s checks are a more secure form of check printing because the money comes directly from the bank, rather than your personal account. We tend to trust cashier’s checks because they’re supported directly by the bank’s funds, which means they won’t bounce like a personal check.

However, even cashier’s checks aren’t 100 percent secure. Scammers use advanced techniques to forge cashier’s checks that look identical to authentic checks. With advances in technology, it’s becoming even easier for scammers to forge fake cashier’s checks.  

According to the Federal Trade Commission (FTC), fraudulent check complaints doubled between 2014 and 2017. As the number of fraudulent check scams increases, it becomes more important to be aware of the scams they use to protect yourself and your finances. Here, we take a look at four of the most common cashier’s check fraud scams to help you protect your bank account.

DIFFERENCE BETWEEN A CASHIER’S CHECK AND MONEY ORDER

Cashier’s checks and money orders are both used as more secure methods of payment as compared to personal checks; however, there are differences between these two types of payment. A cashier’s check functions like a check written by a bank itself. When you fill out a cashier’s check, the bank takes the money out of your account and puts it into their own. Unless the bank runs out of money, this type of check is totally secure. This is why many landlords insist on cashier’s checks for a deposit or initial rent payment.

On the other hand, a money order is similar except that it still comes from your personal account. However, once you send the money order, the payment is as good as cash and can be instantly deposited. Money orders are popular when sending payments internationally.

MORE MONEY THAN YOU REQUESTED

The most common cashier’s check fraud scam is when a scammer sends you a check for more money than you requested. For the unknowing person, this might seem trivial, and even a turn of good luck, since you’re getting more money than expected. But that’s the trap.

The scammer will then ask you to reimburse a portion of the cashier’s check. If you do this before realizing that the check is fraudulent, you’ll be out of all those funds you returned. If there’s ever a discrepancy between payment amounts, this should immediately raise concerns.

FRAUDULENT CASHIER’S CHECKS FOR PRODUCTS

If you sell products (especially online), you may become a victim of a fraudulent cashier’s check. This method of fraud is relatively straightforward. The scammer will purchase a product with a cashier’s check, hoping that you ship it out before realizing the check is fake. If you run a business or personal store, be sure to process payments before sending out your products.

INHERITANCE SCAMS

Did you forget about your great-uncle Joseph? Sometimes, people do, and this is when they become vulnerable to cashier’s check scams. In some scams, people are notified that they’re receiving a large sum of money as part of an inheritance (or, occasionally, some type of lottery or other contest).

You’re notified of this tremendous inheritance you’re about to receive (in the form of a cashier’s check, of course) but first they request that you send some money to cover the taxes or legal fees. The scammer hopes you’ll be so excited by your potential inheritance or winnings that you won’t even worry about paying the small fees. However, the cashier’s check turns out to be fake and you’re left on the losing end of this scam.  

PROPERTY RENTAL AND LEASING SCAMS

If you own a rental or vacation property, you may be at risk from a specific type of cashier’s check fraud. Scammers will reach out and claim they need to urgently rent your property, often for a new job or family emergency. The scammer will send a fraudulent cashier’s check for their first rent payment.

But then something changes (they lost the job or their family issue is resolved) and they no longer need to use your property. Then they’ll ask you for full or partial reimbursement on their deposit. This scam works on the assumption that you’ll reimburse them before discovering that the initial check was fraudulent. Always verify the authenticity of any checks you receive before providing refunds or reimbursements.

WHEN TO USE AND TRUST A CASHIER’S CHECK

Despite the possibility of fraud, cashier’s checks are still a reliable and trustworthy payment method. Cashier’s checks are common methods of payment for expensive purchases or housing or leasing payments. Cashier’s checks should only be used between people who know each other personally or professionally. If your only point of contact with the person is online or through the phone, you should not accept a cashier’s check without some type of verification of their identity.

CONCLUSION – COMMON CASHIER’S CHECK FRAUD SCAMS

Cashier’s checks are a popular way to make large purchases because they’re much more secure than a personal check.  However, even these secure checks can be forged by scammers who work to develop more creative and deceiving methods for draining people of cash. Check out a secure check printing company.

A good rule of thumb is never to accept a cashier’s check from someone you don’t know. If the amount is ever more than what was agreed upon, this should raise an immediate red flag. There’s really no reason for someone to send you a cashier’s check and then need a portion of those funds in cash.

Hopefully, this look into common cashier’s check fraud scams has given you the knowledge and awareness to avoid these dangerous and deceptive cashier’s check fraud scams. 

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