Tag Archive for Cashier’s Cheque Fraud

How to Avoid Becoming a Victim of Cheque Fraud – Part 2

Despite the widespread use of other payment methods, cheques still remain in use.  According to Statistics by the Canadian Bankers Association, Canadian financial institutions still process approximately one billion cheques every year.

Cheque fraud can occur in two different ways. They can either be stolen or fraudsters can make changes to them.  You need to not only protect your cheques from being misused but also from being given one of these fraudulent cheques.

Financial institutions have their own measures to detect if a cheque is fraudulent or not.  However, the common man may not have access to the tools that they have.  However, there are still certain ways in which you can detect whether you have been given a fraudulent cheque.

Most Canadian banks have certain security features built into their cheques such as watermarks or specific designs. These are generally printed on the back of the cheque. If the cheque you’ve been given is not original and has been scanned or photocopied, these intricate designs or watermarks will not be there.  This is one way that you could identify that the cheque is forged.

If you’ve been given a money order or a bank draft and you have certain doubts about their originality, it is always a good idea to call the bank that has issued the cheque to make sure it is genuine and the funds will be released once you deposit it. In addition, there are some basic precautions that should always be taken when writing or receiving cheques.  Always ensure they are properly dated and fully completed; if you see even minor signs of any alteration, do not accept such cheques; avoid accepting post-dated cheques; if a cheque was originally made out to someone else an then signed over to you, do not accept it; do not accept counter cheques.

Be wary of Cashier’s Cheque Fraud.  A large number of people assume that a cashier’s cheque is as good as cash.  That is not always the case.  Sometimes buyers make out a cashier’s cheque in excess of the purchase price of the product.  The buyer then asks the seller to pay him back the extra money.  This is an example of a cheque overpayment scam.  These could be done either through a lottery, auction or secret shopping offers.  You might end up realizing that the overpaid cheque that you deposit is a fake and although the funds may be registered immediately, once the cheque is actually processed, your bank will determine that it is fake.   You will then have to bear the penalty as well as the loss of any funds that you may have wired to the buyer for the amount that he had initially overpaid.

Overall, simple yet effective precautionary measures can help you minimize the chances of becoming a victim of cheque fraud.