Avoiding Fraud by Cashier's Check

Reports indicate that the number of consumer complaints related to fraudulent cashier's checks continues to rise. A cashier's check is a check issued by a financial institution, payable to a specific person. It is often used as a trusted form of payment to consumers for goods and services.

Just because you have access to the cashier's check’s funds that you deposit in your account does not mean the check is good. If you sell goods over the Internet and a buyer sends you a cashier's check for the price that you agreed on, it may take weeks to discover that the cashier’s check is fraudulent. By that time, you may have already used the funds. When the fraud is detected, you will owe the bank the full amount of the cashier's check that you deposited and then used.

Reduce Your Risk of Check Fraud:

• When you use the Internet to sell goods or services, consider receiving the payment through an online payment system rather than receiving payment by a cashier's check.
• Don't spend money received from an unfamiliar person until a branch manager of your financial institution says the funds have been cleared.
• If you're selling something, never accept more money than your selling price.
• Wait until the check clears before providing the goods or services to the buyer.
• If you want to find out whether a cashier's check is genuine, call or visit the financial institution on which the check is written. The financial institution will be in a better position to tell you whether the check is the one they issued and is genuine.
• Save all of your documents including letters and e-mail correspondence, receipts and copies of business transactions. You may need the paperwork if something goes wrong.