At a recent Knoxville Estate Planning Council meeting, I had the privilege to hear an esteemed estate attorney’s presentation entitled, “From Catfishing to Pig Butchering: Scammers are Stalking Our Clients.” It was an informative presentation where she covered all types of common scams and the neuroscience behind it.
REMEMBER THE RED FLAGS – if you feel:
Fear = Think SCAM!
Fear + Urgency = Think SCAM!!
Fear + Urgency + Pressure = Think SCAM!!!
Fear + Urgency + Pressure + Secrecy = Think SCAM!!!!
Fear + Urgency + Pressure + Secrecy + Money/Gift Cards = SCAM!!!!!
As a millennial, I don’t use checks or cash very much. However, I was very surprised to learn about a common Venmo/Zelle scam that would be very easy to fall for!
Just because a check “clears” doesn’t mean it’s real!
The fake check scam arises from many different situations (fake job scams, fake payment scams for purchases on Facebook Marketplace, Craigslist), but the bottom line is always the same:
- You receive a check (a picture of a check or an actual check);
- You deposit the check and see the money in your account;
- You use the funds to give money to the scammer.
The bank will eventually take the initial deposit back, and any money you sent to the scammer will come out of your own personal funds. Usually, the fake check deposit will be reversed in a few weeks, but it can also take several months. If you do not have the funds to cover the amount, your balance will go negative. Your bank will usually charge a fee for depositing a bad check, and your account may be closed depending on the severity of the scam.
Cash App / Venmo / Zelle Scam
This is a type of advanced check scam. A hacker uses their access to a hacked bank account to send money to your bank account via Zelle or another peer-to-peer payment app. Several days later, someone contacts you by text or phone alerting you that they have transferred money into your account by mistake and would you please return it to them? Funds you were not expecting have indeed been transferred into your bank account. You, a polite and decent person, Zelle the funds back to their “rightful” owner. Weeks later, the funds from the hacked bank account are clawed back out of your account and you are out the funds you returned to the scammer.
For more information on steps to spot, avoid, and report fake check scams, read the Federal Trade Commission article here and a recent AARP article here.