Editorial: Beware of fraudulent checks allegedly issued by the state

Jun. 24, 2013 @ 11:41 PM

Every business has had to deal with bad checks, sometimes written by customers who didn’t realize their accounts were that low, but often by people who know they can’t cover the checks but write them anyway. It was inevitable that scammers would find a way to use check-cashing in their schemes to rip off people.

In recent weeks, the Tennessee Treasury Department has received reports of fraudulent activity involving checks that appear to be from the “State of Tennessee,” “Tennessee State Treasury” or something similar. The Treasury Department processes all checks issued by the state. These fraudulent checks, State Treasurer David Lillard Jr. says, are being used in various schemes to defraud the people who cash the checks by encouraging them to send some portion of the funds to the criminal or criminals who sent the checks.

There are several scams in which the fake checks have been used, Lillard said. In one example, advertisements are placed on websites such as craigslist.com or local newspapers offering free money or work-from-home opportunities. Consumers who respond to those ads are given instructions on what to do with the checks. The instructions typically involve asking consumers to cash the checks, then immediately wire money to the check senders. In most cases, the consumers are allowed to keep portions of the funds from the cashed checks.

In other examples, consumers are convinced to accept these checks in return for goods or services rendered during the course of business transactions, he said. The amounts of the checks are often for more money than the cost of the goods and services so the consumers are asked to wire the extra funds back to the check senders or to keep the additional funds. (Consumers are ultimately responsible for covering the amounts in wire transactions.)

Other examples include criminals using bank account information obtained from real State of Tennessee checks to pay for online goods or services.

For consumers, many of the forged checks are nearly impossible to distinguish from authentic state checks. Consumers are urged to be cautious about accepting State of Tennessee checks from anyone other than representatives from state agencies with whom they have some connection or business. That’s good advice in these days when somebody is always out to cheat you or steal from you.