Phony Checks Costing Consumers Billions – National Consumers League

blog posted by Sally Greenberg, NCL Executive Director

The National Consumers League is the only consumer group that has a Fraud Center and is actively engaged in battling Internet and telemarketing fraud. This October 3, the Alliance for Consumer Fraud Awareness, of which NCL is a member, launched its “Fakechecks.org” Web site, with press conferences in New York and Washington, D.C.

I spoke at the press conference at the TimesCenter in New York, and the Director of NCL’s Fraud Center, Susan Grant, spoke in Washington, DC at the Press Club. The centerpiece of the campaign is a new NCL Web site, www.fakechecks.org. The Alliance warned consumers that while there are many different ways scammers set up the fake check scheme, there is a single common thread running through them that can enable consumers to identify it as fraud: no one who legitimately wants to give you a check or money order for something would ask you to wire money anywhere in return.

NCL also called on banks to warn their customers that just because the funds are available quickly doesn’t mean that the check is good.

The Alliance announced a new consumer survey found that 35 percent of adult consumers had been presented with a fake check at some point and that 28 percent of those had actually sent money back. Fake check scams tend to cost consumers between $3,000-4,000 each year. Based on these numbers, NCL estimates that the cost of fake check scams to be between $63 and $84 billion each year.

We’ve spotted 6 general categories of fake check scams: work at home, love losses, rental schemes, foreign business offers, sudden riches, and overpayments. The pitches scammers are coming up with are plausible, and the checks are so convincing – it’s no wonder consumers are falling for this! But we hope www.fakechecks.org will help spread the word about these phony checks.