How does the scam play out?
There are several variations of the fake check scam, but all of them ultimately lead to the victim cashing an extra-large fake check and returning the difference to the scammer.
In one scenario, the scammer will send a bad check to a potential new roommate. The check allegedly secures the renter’s spot in the room, and will be made out for an amount that is greater than the requested holding deposit. The victim will be asked to deposit the check and send the extra funds back to the “renter.” Unfortunately, the check won’t clear and the victim will never see that money again.
In another variation, a young college student will be offered a remote position working for an alleged business. The student will receive a check to use for purchasing supplies or to cash as their paycheck. Here, too, the check will be made out for more money than necessary, and the victim will be instructed to send back the difference to the scammer. Again, the check will ultimately not clear and the student will be out the money they sent.
In yet a third variation of this scam, students will receive phone calls or messages from companies promising to lower their student loan payments. After applying for this “service,” the student will be sent an extra-large check. The rest of the scam will follow the same script described above.
How can I spot a fake check scam?
Watch out for these red flags which likely indicate a scam:
● You’re asked to cash a check that is made out for more money than necessary and to return the difference to the sender.
● The alleged roommate, employer or loan company insists on paying you via check only.
● You cannot find any information online about your potential new roommate, employer or loan company.
● The alleged roommate, employer or contact from the loan company refuses to answer any of your questions about their location and refuses to meet face to face.
If you suspect a scam, cut off all contact with the scammer and report it to the Federal Trade Commission at FTC.gov and to the Better Business Bureau at bbb.org. It’s also a good idea to warn your friends and classmates that this scam is circulating so they don’t fall prey to it.
It’s also a good idea to keep an eye on your credit. As a young student, you are a primary target for scammers. If your financial information has been compromised and a scammer is helping themselves to your credit file to open loans or lines of credit in your name, you may not learn about this fraudulent activity until extensive damage has been done. You can monitor your credit via a free service like CreditKarma.com, and by requesting your annual complimentary credit report from AnnualCreditReport.com. Review your monthly credit card statements as well and check for suspicious activity on your accounts.
Adjusting to college life is hard enough without dealing with scams. Proceed with caution and be wary of anyone offering you more money than you’re expecting for whatever reason. Stay safe!
Your Turn: Have you been targeted by a fake check scam? Tell us about your experience in the comments.
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