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Check Overpayment Scams

In the check overpayment scam, the person to whom you're doing business with sends you a check for more than the amount they owe you, and then instructs you to wire the balance amount back to them. Else they send a check, and tell you to deposit it and to have a part of amount for your own compensation, and then wire the rest back for one reason or another. In both the cases results are the same, the check eventually bounces and you're stuck, responsible for the full amount, including what you wired to the scammer.
The Federal Trade Commission (FTC) is warning customers of a dangerous and growing swindle called the "check overpayment" scam; nowadays this issue had become most common in the list of Internet scams.
Scammers in this type of scam target users of the internet who are selling their products online in auction websites or classified ads. Check overpayment scammers usually bring out legitimate reasons for overpaying the amount and genuinely request you to wire back the additional amount paid to you. A brief information about their scam activities are collected and to report the fraudsters, several website links are provided.


Cautions:

The checks in this scam are not real, but they look legitimate enough to fool most bankers and it is also one of the greatest risks which should be considered as the serious issue.

Tips to avoid Check Overpayment Scams:

• Know to whom you're dealing with and independently confirm your buyer's name, street address, and telephone number.
• If you're selling something over the Internet, say "no" to a check for more than your selling price, no matter how tempting the request or convincing the story.
• There is no legitimate reason for someone who is giving you money to ask you to wire money back.

DID YOU KNOW ABOUT CHECK OVERPAYMENT SCAM?

• "Check Overpayment scam" is the 5th most common telemarketing fraud and 4th most common Internet fraud reported.
• Check overpayment scam is one of the most common yet dangerous types of internet scam.">
• The most common people who are targeted by scammers for check overpayment scam are consumers selling products online in classified ads, users getting paid for work from home and people winning lottery schemes.
• 70% of the people fall prey to the lottery winner version of this scam.
• The fake checks sent by scammers appear to be so legitimate that even bankers are sometimes fooled seeing the checks.
• Check overpayment scam is the most reported scam in telemarketing fraud.

Ways to avoid check overpayment scam:

1. Always get the accurate contact details of the buyer and cross check them twice
2. Never agree for an overpayment for anything that you sell. Scammers main motive is to get funds from you in the name of wiring back extra funds
3. Avoid checks for a payment when you are selling something online. Insist on online fund transfers and other sage modes of payment.
4. If you accept payment by check, ask for a check drawn on a local bank or a bank with a local branch. You can visit that bank branch to determine if the check is legitimate.
5. Never get carried away by any free lottery scheme offers. Scammers lure you to pay first and then pay you nothing later.
6. Cancel the transaction immediately if you are asked to wire back funds to the buyer.
7. File a complaint to the authorities if you receive any fictitious checks.
8. Consumers are advised to do proper homework on the potential employer before making any transaction.
9. Cross check and verify the legitimacy of the check by your nearest bankers.
10. Never get carried away and act hurriedly on any offer.


Variations in Check Overpayment Scam

• Work from home scam:
In work from home check overpayment scam, the scammer attacks users who are looking for opportunities to work from home. The scammer sends in work to the employees and during the time of the payment sends them fake checks with overpayments. The employee is asked to wire the excess amount back to the employer. Once the amount is wired back, the scammer vanishes with money leaving the user loose his money. The user loses his money along with the work done for the scammer.
• The lottery scheme:
In the lottery scheme, scammers send out bulk emails to a number of users stating they have been chosen as the winner of a foreign lottery scheme. They also send attached to the email a counterfeit or a fake check so that it appears to be legitimate to the user. The scammer smartly enters an overpayment amount in the check and asks the lottery winner to wire back the excess amount to the scammer. The users who get carried away by the fake lottery winning scheme will wire back the amount and scammers get benefited by such user's money.
• Shopping overpayment scam:
In the shopping overpayment scam, scammers approach the prospective users as buyers of their products. Most common buying from scammers includes cars, televisions, trucks etc. The scammers initiate the transaction as if they are interested in buying the deal and in return send the user a fake check with overpayment asking the user to wire back the additional funds. Once the user wires back the additional funds and deposit the check sent by the scammer, they realize that the check was fake and they have been scammed.
• Secret shopper scams:
In secret shopper scams, the consumer, hired to be a secret shopper, is asked to evaluate the effectiveness of a money transfer service. The consumer is given a check, told to deposit it in their bank account, and withdraw the amount in cash. Then, the consumer is told to take the cash to the money transfer service specified, and typically, send the transfer to a person in a Canadian city. Then, the consumer is supposed to evaluate their experience — but no one collects the evaluation. The secret shopper scenario is just a scam to get the consumer's money.

Statistics on Check overpayment scam:

Pie chart showing variations in check overpayment scam:

It is inferred that majority of check overpayment scams are carried out through work from home schemes followed by the famous foreign lottery scheme and then the shopping scheme. Most of the users fall prey to check overpayment scam in the work from home scheme, thus wiring money back to the scammers in the name of additional funds.
Pie chart check over payment scam




Examples of check overpayment scam:

1) Below screenshot is a sample email that states that the user has won a jackpot attached with the email is a check amounting to $2988. The user is asked to wire back amount to the scammer. The screenshot shows the example of check overpayment scam.
Phony overpayment check scam


2) The below screenshot depicts the example of Ohio Bank name which is tied to online job scams. The first federal bank of Ohio in Galion reported that counterfeit cashier checks were being presented for payment nationwide as a [art of check overpayment scam.
Counterfeit checks with ohio bank's name


3) The below screenshot is another example of check overpayment scam whereby a scam letter is sent out to wide number of users on the name of Canada lottery winning schemes.
Phony check scams canadian lottery


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