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2005 - The Year of Counterfeit Official Checks
March 12, 2006
Financial institutions all over the country tell the same story. 2005 saw a sharp increase in the number of counterfeit instruments being passed over the counter by their customers. Whether they are a community bank, a credit union or one of the national banking giants, losses last year resulting from counterfeit postal money orders, treasury checks, and traveler checks increased by hundreds of percent over the previous year.
Fortunately, businesses that use the Fraud-Fighter line of ultra-violet verification products will discover that they are not as exposed to these issues, because most of these types of financial instruments are printed on proper “UV-dead” paper, and contain fluorescent features that glow under UV light.
The criminals often target people selling items online or through classified ads, says the U.S. Postal Inspection Service, which investigates counterfeit postal money orders. The scams have also snared people looking for roommates and members of online dating services. Consumers should be wary about cashier's checks and money orders, especially those being offered as "prizes" in a phony sweepstakes or lottery.
Scam artists have figured out that there are certain types of instruments that people question less than others. Unfortunately, cashier's checks are high on that list. So are money orders. They assume a cashier's check will never bounce.
In one very common type of scam, a victim receives a cashier's check or money order from somebody he or she does not know. The victim is told that he or she should cash the check or money order and send some or all of the money to a third party. When a bank discovers the check or money order is counterfeit, victims can lose thousands because they are required to pay the money back. Some see their credit ratings wrecked.
A new twist in the scam is the use of an authorization letter advising a financial institution that the sender is authorized by the U.S. Postal Service to negotiate the instrument. Don’t believe it—the letter is a fake! The Postal Service does not issue authorization letters, and the receipt of one should raise a red flag to financial institutions and potential victims.
For more information about protecting yourself against counterfeit cashiers checks, money orders and treasury checks, please feel free to contact us.
