What happens if you unknowingly deposit a fake check?
“I deposited a check/money order into my account, but the bank later told me it was fraudulent. I had already used some of the funds, and now my account is overdrawn. The bank says that I am liable for the entire amount. Is this true?”
Well, not necessarily. If in case the bank credits the amount not your account. There is a chance that they are going to reverse it if they find the check is fraudulent. Therefore, you must check the agreement for the deposit account. Check for the information on the policies of the bank when it comes to fraudulent checks.
Fraudulent checks are parts of an overpayment or a money order scam. This is a clear example of why you should never accept a check from anyone that you do not know.
Depositing a fake check may actually land you in bad consequences. Therefore, it is something that you need to take care of every time you receive or deposit a check.
What Is A Fake Check?
A fake check is extremely tough to recognize. In no way can you ever spot a fake check. Due to technical advancements, these checks and money orders are so accurately done that not even the bank representatives can identify them as fake.
In most of the cases of check scams, the person would ask you to deposit or cash the check. Once you deposit the check, they will ask you to buy gift cards or just refund them a certain portion of the check amount.
Later, when the bank realizes that the check is counterfeit, you are going to be the one who would be held responsible for returning the money to the bank. Not a scammer.
With an increase in the scam rate, most of the scam approaches that you may receive are going to be the ones that would claim that:
You have won a prize: This is where the scammers are going to tell you that you have won a “prize.” They will be sending you a check but will ask you to wire funds to cover the fee or taxes. And after paying the fees, when you are least expecting it, the check turns out to be fake.
You are hired as the assistant or a mystery shopper: Scammers could “hire” you as the virtual assistant or as a secret shopper. They will send you a check and would like you to use the money to purchase gift cards for them. Once you send the gift cards to the scammers, they redeem the cards. And you would have to pay the money that you would have to spend when the check comes out as fraud.
You were overpaid: When someone buys an item from you, they might just pay you more and request you to refund the difference. Once the fund goes through, you may end up realizing that they had sent you a fake check.
What Happens If You Unknowingly Deposit A Fake Check?
No one really knows if the check they are holding is fake. Therefore, landing in a situation where you are depositing a fake check is not surreal. There have been many cases where people have unknowingly deposited fake checks.
However, even if you are depositing a fake check unknowingly, there are bad consequences.
You May Have To Repay The Entirety Of The Amount
The laws and policies vary from one bank to the other. So, if you are depositing a fake or a fraud check, you may just have to pay the entire amount back to the bank.
You Might Have To Pay The Overdraft Fees
If you have already spent the amount even before finding out that the check is a scam and debits your account, it is quite possible that the bank overdraws your account. In that case, you may have to pay the overdraft fees, an average of $30 for every transaction.
The Bank May Freeze Or Close Your Account
If you end up depositing a fake check, even unknowingly, the bank may reach the decision to freeze or fully close your account. Go through the bank deposit agreement to see what are the scenarios under which the bank may close the account.
It Can Easily Damage Your Scores
If you are having bills that have a link to your checking account, and in case the check bounces, you may miss your bill due dates. The payment history is one of the biggest factors that all credit bureaus use to decide your credit score. Therefore, missed payments can easily damage your credit score.
You would have to pay a late fee: If you are not able to pay the bills due to insufficient balance after cashing the bad check, the companies will charge you a late fee. For instance, credit card late fees may go as high as $40.
It Will Affect Your Banking History
If you hold a history of depositing fraud or fake checks, the checking account reporting companies will keep a record of that information about your checking history. Credit unions or banks may use this information to decide whether they would allow you to open a checking account. If you have a very stained banking history, there is a high chance that they are going to reject your request.
How Do You Know If The Check Is Fake?
While there are no solid ways to find a fake check, there are some common practices that you would want to do to at least be risk-free when you are depositing a check.
- Learn and be aware of the most common ways in which you can receive a fake check. Stay away from those.
- Inspect the check thoroughly to see if there is anything wrong with it. Check the logo, feel the paper edges, or anything that you have never come across with any of your checks before.
- Wait for the official clearance of the check before you start spending the money.
- Never send the money back.
- Do not accept any overpaying checks.
The Bottom Line
Fake checks are very common in the United States. A lot of people have fallen victim to this scam, and many are still in line.
With half the people being unaware of it, it is a common question among depositors: “What happens if you unknowingly deposit a fake check?”
Even when you are depositing it unknowingly, there are major consequences of it. These consequences may even reach a point where the bank closes your account. Therefore, always be aware of the most common scams and try to prevent them as much as you can.