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New fake check scams on the rise

Monday, November 03, 2008

Gotten any award notices or hefty checks from Publishers Clearinghouse lately? With the stamp of approval from Oprah Winfrey or Martha Stewart? Before you take that to the bank, make sure it's legit. Consumer Action and other groups are warning consumers about new and creative fake check scams using "award letters."

Here's how one of the scams works: crooks send you a letter that looks like it's from Publishers Clearinghouse claiming you've won $10,000, courtesy of Oprah's O Magazine. A $5,000 check is enclosed to "cover any expenses" you may incur until you receive the full award and you're instructed to call an 800 number to get all the details. The number sounds legit and the representative couldn't be nicer. He asks you to wire the $5,000 back to him so he can send you the award check ASAP. The bank has cleared the check so you go ahead. As soon as you wire the money, however, the truth comes out. The check actually bounced. Because the crooks used the name and account number of a legitimate company, the bank removed the temporary hold on the money. But the money never materialized and now you're out $5,000.

Also, California residents should watch out for a similar fake check scam using checks that appear to be from Los Angeles county. According to the Los Angeles County Department of Consumer Affairs, victims receive a notice from the "Canada Customs and Revenue Agency" claiming that that have won a lottery prize. They are then instructed to call to claim their winnings and told they must pay a customs fee to receive the money. If the scam victim balks at this, they receive a check that looks like it was issued by the County of Los Angeles which they are asked to deposit, then wire directly back to the crooks. Of course, the prize money never shows up.

Fake check scams can be avoided by paying attention to a few tip-offs:

1. You have to wire or somehow send money. No legitimate contest ever requires you pay money or buy something.

2. The "award" check has the name of an unrelated company on it. Also, no matter how real the check looks, and even bank tellers are often fooled, it doesn't mean it is good. Regardless of how real it looks, if it's a fake check, you are still responsible for the money once you deposit it. If you knowingly deposit a fake check, you are breaking the law and can be prosecuted.

3. You have to call to claim your prize. The real Publishers Clearinghouse sweepstakes contacts you and if you win $10,000 or more, the Prize Patrol makes a surprise visit. Checks for less than $10,000 come via certified mail. Publishers Clearinghouse put a warning on its Web site earlier this year about the use of its name in conjunction with that of Oprah Winfrey in fake check sweepstakes scams. Click here to read the warning

4. You almost never get something for nothing. Use common sense. If it sounds too good to be true, it is.

For more information on fake check scams, visit FakeChecks.org