Cheques for Legitimacy: Internet Scams Part 2

Yesterday I talked about common internet scams that pop up from time to time on my social media pages. I mentioned scams from fake tax representatives to sharing Facebook photos. I forgot one important that also keeps appearing from time to time. Since it’s such a big one, and so costly to the victim involved, I decided to give this one its own blog post.

What is it? Money laundering schemes that often come in the form of fake or forged cheques. This scam has been around since people could use cheques to send money, and will still be around as long as cheques are alive and kicking. Here’s how these tricksters work today, and how can avoid being their next victim:

Step 1: Offer You a Job

Text messages, emails, and even phone calls from apparent employers offering you or me a job occurs all across the globe. Usually these are unsolicited, and come from “companies” we never applied for. Yet, they contact us with promises of making money easily. Sometimes the “jobs” look legitimate: They’re looking for mystery shoppers, need someone to be a mobile marketer, or perhaps Coca-Cola needs a new admin assistant.

car-wrap-text-message

From the CBC Marketplace’s article. This is the original text message Louanne Cataford received. Tempting, right?

Today on CBC’s Marketplace a story was reported about a young university student who was offered a “job” through an unsolicited text message in Montreal. She never heard of the company, never mind applied to work for them, yet could not turn down making $300/wk driving around her car with their company logo.  When she emailed the sender, they seemed to answer her questions about the job in a fair, and unsuspicious manner.

Often they hide behind the names of legitimate companies, like Mystery Shoppers’ Canada or in Louanne Cataford’s case: ” Eden Water and Coffee, a legitimate European company” (Hendry, Leah; CBC; 2016). What happens next is where the red flag should appear, and I’m even going to put the heading in red!

Step 2: Get Paid before doing any Work?

The next step in this process is the “company” will send the person a cheque. The cheque will more than likely clear at the bank, and the new employee keeps a portion of the money as their first “pay cheque.” Then they are supposed to send via money order, or deposit into another bank account the rest of the money.

In the mentioned story above, Cataford was sent a $3,985 cheque from a customs’ brokerage firm in Fort Erie, Ontario, Canada. She was instructed to keep $300 for her first pay cheque, and then deposit the rest into a CIBC bank account so the graphic designer can make the banner for her car. She did as instructed, and her employer was willing to wait the 5-7 business days for the cheque to clear the bank, and then sent the rest of the money where it was supposed to go.

Unfortunately for her, which I can sympathize because she’s only 19, that entire paragraph should have been full of red flags: First, why would the company get her to pay the graphic artist, instead of sending the artist the money directly? Second, why is she getting paid before doing any work?

 

Step 3: Consumer Pays the Price

Originally in our story, she assumed the cheque must be legitimate, since it cleared after five days. Surely that is proof the cheque was legitimate, right? Not so fast…

“That’s a misperception that, yes, could be out there,” said Mélanie Baillargeon,  a senior adviser for security and fraud prevention at the Caisse Desjardins (Hendry, 2016).

In fact, no cheques are guaranteed until they’ve gone completely through the due dilligence via the bank. All that the five days do is ensure the account who issued the cheque exists, and the funds are there. In fact, the only cheques that don’t get put on hold are usually government cheques (GST, social assistance, etc), and that’s only if one cashes them at a bank teller.

Proving whether the cheque is counterfeit can take weeks to months. According to Payments Canada, a bank has 90 days to ensure a cheque’s legitimacy. Once it is revealed to be a fake, the onus is on the person who deposited the cheque to pay it back. That’s right, the onus is on the depositor to pay back the funds!

This is why people like Cataford find themselves in the whole for 1000s of dollars once the bank discovers the trickery. By this time the rest of the money and the fraudsters are long gone into the black hole that is the internet. This isn’t the only thing you could get in trouble for.

Once a person cashes the cheque, and breaks up the money, they have crossed the line from legal to illegal. The reason it goes into illegal territory is because this is a form of money laundering. 

Money Laundering: 

  1. the concealment of the origins of illegally obtained money, typically by means of transfers involving foreign banks or legitimate businesses.

 The farther and more divided the money goes, the harder it is to track, and the more illegal it becomes. As stated above, cheque fraudsters have been doing this for decades, and the internet and cell phones have allowed for things to get much easier for them: They can reach a wider amount of people, and spread the money wider geographically than ever before.

Good luck and God’s blessings to the authorities too finding the original tricksters. 

Key Red Flags to Look For:

  1. Initial Point of Contact: If you can’t remember applying to work for the company, ignore the person contacting you! No matter how tempting the money is!
  2. The email address provided: Legitimate companies may use gmail or outlook’s platform, but don’t have @gmail.com for their emails. Usually they’ll have company-based emails. Once you see @gmail, @hotmail, @yahoo, and etc. run away!
  3. Check for grammar/spelling: Employers should pride themselves on sending grammatically correct emails. If you are sent one with many spelling mistakes,  good chance things aren’t as legitimate as they seem.
  4. Get paid without doing work: Real employers don’t pay employees before they do anything for them. They certainly don’t give them cheques to cash and then go and pay other people working for them. The moment they talk about sending you a cheque where you keep a portion, and then send it to another account  is the moment you block the email, and block the number. Report it to the police too if you can!

Happy Ending

So, is our student from Montreal still owing $4000? Thankfully no, according to the CBC’s Investigate in Montreal:

After being contacted by CBC Montreal Investigates, the Caisse Desjardins set up a meeting with Cataford, and she was reimbursed the money she deposited in the CIBC account.

The Caisse’s investigation, which appears to have been prompted by CBC’s queries, showed that Cataford was the victim of a “well-orchestrated scam.”

It said financial institutions evaluate such circumstances on a case-by-case basis.

In a statement, the Caisse said the cheque had cleared through the normal clearing process and was then returned to the credit union with a fraudulent cheque notice.

“As Ms. Cataford was able to prove that she had not used or benefited from the $3,685, the Caisse conducted a complete review of the file and agreed to repay the $3,685, which was the amount returned to the fraudsters.”

“It’s been a heavy weight off my shoulders,” said a relieved Cataford.

Unfortunately, not all of the scammers’ victims are as lucky.

Unfortunately, indeed. Thankfully I am adding one more resource in the fight against fraudsters! Remember if it’s too good to be true, it is!

 

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