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Check Fraud: Can You Still Trust A Cashier’s Check?

by J_Pratt

Cashier’s Checks have long been considered the “gold standard” of checks. Drawn on the bank itself, there is no question that the funds are good. So if someone wants to give you a Cashier’s Check (or “Official Check”) there’s no fraud risk, right?

Wrong.

Criminals are now capable of producing high-quality counterfeit Cashier’s Checks that cannot be detected by visual inspection. Knowing that society has been raised to trust a Cashier’s Check without question, many scammers – and especially email scammers – are able to convince the victim to accept and deposit a Cashier’s Check, and then immediately wire funds to someone else. Victims do so believing that the Cashier’s Check must be good. But if the check is counterfeit, the bank it is allegedly drawn on has no obligation to honor it. With the money that was wired out already gone, the bank has the right to recover the money from the victim… who could be you.

Don’t count on your bank being able to recognize these counterfeits upon deposit. You need to be your own detective to protect yourself from this risk.

• If you are given a Cashier’s Check, call the bank the check is drawn on to confirm that the check “has been issued”. Get the phone number to call from the bank’s website or from Information (411); do not use any phone number that is printed on the check itself.
• Do not use the funds for at least 5-10 business days after you have deposited it. Even if your bank makes the “funds available” to you, wait several days before using the money. It usually takes at least 2-5 business days for a check to be returned. Play it safe.
• Call the bank of the Cashier’s Check to determine if it has “cleared” (or “been paid”).Keep a copy of the check and call the bank that it’s drawn on two days after the deposit has been made at your bank. Until that bank can tell you “it’s been paid”, don’t use the money.
• Insist that payments be sent to you by wire. Instead of a Cashier’s Check, have the funds wired to you. Although there will most likely be a fee, a wire is an “immediate” payment, unlike a check. (Your bank can tell you how the wire can be sent so that the sender does not need to know your bank account number.)