How to Spot a Fake Check

Fake check scams are on the rise. According to the Federal Trade Commission, complaints about fake check scams have risen 65% since 2015. Not only are these scams becoming more common, but also they tend to deal a bigger financial blow to victims. The median loss per victim is $2,000—which is higher than any of the other most-common scams reported to the FTC.

With fake check scams, individuals receive a check and are instructed to deposit it and forward a portion of the funds to someone else before the bank discovers the check is fake. This leaves the consumer responsible for the money withdrawn and can lead to your bank account being frozen or in some cases, facing criminal charges.

How fake check scams work

Fake check scams come in many shapes and forms.However, these are the most common ways scammers offer fake checks as payment use:

• Agreeing to pay you to work from home

• Buying something you’ve listed for sale online
• Giving you an “advance” on a prize or sweepstakes you’ve “won”
• Giving you a payment for transferring money to hold in your bank account
• Being offered a government grant or scholarship via check that includes additional funds for taxes

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Fake check scams happen most often by mail or email. These scammers will send you a check or money order for more than the amount owed to you. Then they will instruct you to send the excess funds back to them as soon as possible, usually via wire transfer. After the money has been sent, victims find out that the check was fake and are on the hook for any money they lost.

[ Find Out: How to Avoid Payment App Scams and Fraud ]

How to tell if a check is fake

If someone sends you a check to deposit, look for these signs that the check is fake:

1. Bank logo: Fake checks will sometimes be missing a bank logo, or, if they have one, it may appear faded or splotchy if it was copied.
2. Bank address: If there is no street address, only a P.O. box or an incorrect zip code, this could indicate the check is fake. Contact the bank that issued the check to verify the address and information.  
3. Paper: The paper stock used for authentic checks is often thicker than average paper.
4. Edges: Most real checks have one perforated (rough) edge. Checks with every edge smooth may have been printed as fakes.
5. Check number: Look to see if there is a check number in the upper right corner. Also, make sure the number in the corner matches the number in the MICR line (located at the bottom of the check). If the number doesn’t match, you have a counterfeit check.
6. Routing number: Look at the MICR line—the routing number is typically the first nine digits of this and identifies which bank issued the check. If your check is missing a routing number or has a routing number that isn’t nine digits, the check is a fake.
7. MICR line: The line of numbers at the bottom of a check (made up of the routing number and account number) is in a specific font. The font, MICR (magnetic ink character recognition) can only be read by a special machine. Fake MICR numbers look different, and are usually shiny.
8. Signature: If the signature has stains, looks splotchy or appears to be printed onto the check, this could be a sign that it was printed or scanned.
9. Other Irregularities: Look over your check and make sure there are no other unusual features. Check that the amount of the check matches the spelled out amount, and look for any spelling errors. Also, look to see if there are any areas that appear to have been erased or altered- this could mean the check you have is a fake.

It is also important to remember that there is no legitimate reason for someone to pay you by check and request you to return a portion of the funds through a wire transfer. If a stranger is paying you for something, ask for a cashier's check for the specific amount from a local bank.

[ Read: Watch Out for Check Washing Scams ]

If you become a victim

If you think you’ve been targeted by a fake check scam, report it to the following agencies:

• The Internal Revenue Service Identity Protection Unit (800) 908-4490
• The Internet Crime Complaint Center
• The U.S. Postal Inspections Service (if the check arrived by mail)
• The Federal Trade Commission
• BBB Scam Tracker

In addition to these agencies, you’ll also want to report the scam to your bank and local police. If recovering the funds is an option, having a police report may help with future claims.

After reporting the scam, you should do the following: :

• Lock or close any accounts that may have been compromised.
• Consider freezing your credit to prevent new unauthorized accounts from being opened in your name
• Keep detailed notes of important information such as the date of the scam, names of individuals involved, amount of money, etc.
• Keep a close eye on your credit and financial account statements so you can notify your financial institutions if you see anything is amiss. Better yet, sign up for a service such as Carefull that will monitor your accounts, credit and identity for you and alert you to any unusual activity and signs of fraud.

[ Keep Reading: 10 Signs You’re a Victim of Fraud or Identity Theft ]