When you accept a cashier's check from someone, you might assume the check is good because it looks official. But that's not always the case, as scams involving fake cashier's checks are abundant. Learning how to verify a cashier's check gives you the knowledge necessary to make sure you're truly getting paid and that the bank honors the check. Otherwise, you're putting your money at risk.
Cashier's Check Fraud
Cashier's checks are financial instruments that are drawn on bank funds and issued by the bank itself. Because the funds are essentially guaranteed by the bank, cashier's checks have historically been considered a highly secure and safe way to transfer funds between individuals or businesses. While this is true if the check is genuine, many scammers use forged cashier's checks as a way to steal money and merchandise from people. While there is no way to verify a cashier's check online, there are steps you can take to protect yourself.
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If you deposit a fake cashier's check in your bank account, the bank will eventually detect the fraud. At that point, that deposit will be reversed and you will be responsible for any overdraft and bounced check fees that result.
Start With Visual Clues
Cashier's checks are usually printed on heavyweight paper. You should see a bank's name and logo on the check along with routing and account numbers. If the check lacks this information, looks fake due to the quality of the paper or is badly printed, this might be a sign that the check is a fake.
To make sure checks are authentic, however, don't rely solely on visual clues. Some fake checks look perfectly legitimate, so you need to take extra steps to verify that the check is good.
Call the Bank
Call the bank on which the check was drawn. Verify that the check amount and the number match the bank's records. When possible, request only checks that are drawn from a local bank or branch. This way you can visit the bank in person to confirm the check is real.
If you decide to call rather than visit the bank, don't call the number on the check or the number provided by the person who gives you the check. Go online and visit the bank's website and get the branch phone number yourself. The number on the check may be fake and set up with a conspirator to give you answers that make it sound like the check is real.
Accompany the Person
One clear way to verify a cashier's check is to watch the teller at the bank prepare it and hand it to the person who is paying you. This requires planning ahead of time so the person knows you expect to go together to the bank as part of the process. If the person already obtained the cashier's check, ask her to go with you to the issuing bank so you can cash the check before handing over the goods.
Recognize the Signs
If someone sends you a cashier's check for more than he owes and requests you to mail the excess funds back to him, refused to do so. That's a sign the check is fraudulent as there's absolutely no reason for someone to make this request. Another sign the check is fake is when you are asked to pay for something you supposedly won. For instance, if you receive a letter saying you just won a lottery or have become an heir to someone's property, and you're asked to pay a processing fee in order to get your winnings or inheritance, stop right there because you're probably being scammed.
The Office of the Comptroller of the Currency maintains a database of financial fraud alerts, including cashier's check fraud. You can check this database to see if the bank name on the cashier's check is being used in a scam.