Check Cashing Fraud
Check cashing is one of the most popular scams out there, duping victims out of millions of dollars every year.Check cashing fraud essentially refers to act of cashing fake checks into a bank and withdrawing the money out before the check inevitably bounces. Check cashing fraud has become increasingly sophisticated over the years and for the most part has managed to keep one step ahead of fraud prevention practice set out to thwart it.
Initially check cashing fraud consisted of the criminal creating the bogus check, going into a bank and cashing it for money on the spot, and leaving before the bank realises the check is fake. This particular crime was made famous by real life fraudster Frank Abagnale Jr. and Hollywood movie “Catch Me If You Can” which detailed the story of a young criminal who travelled America cashing fake checks.
Of course, the problem with this crime was that the scammer was forced to travel as upon realising the check cashed was a fake, the authorities and bank officials would be alerted and the scammer would then likely be caught trying to cash fake checks at the same bank as before.
This leads to what we know as cash checking fraud today – where scammers employ innocent yet naïve victims to cash their fake checks for them, withdraw the money, and then transfer that money back to the scammer using untraceable money wire services like Western Union or Moneygram – services that are extensively utilised by scammers in other types of scams, especially Advanced Fee Fraud.
The template of the scam is always the same – send the victim a check, ask them to withdraw all or some of the money, and transfer it through an online money wire service. The only thing that changes is the reasons and excuses the scammers use to get their victims to do what they say.
For the full article, including examples and recent check cashing scams in our database, click here.