Fraud victim advocacy, fraud recoginition and prevention education, and law enforcement support

fraud recognition & prevention education, fraud victim advocacy, law enforcement support

Fraud recognition & prevention education, fraud victim advocacy, law enforcement support

 

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Secret Shopper scams

By Annie McGuire

Thursday, June 28, 2007

 

 

Secret Shopper scams are completely different from legitimate Secret Shopper jobs.  A legitimate Secret Shopper employer pays qualified individuals to rate restaurants and retail stores.  In other words, you are paid to dine out and go shopping.  A Secret Shopper is never, ever asked to test a money wiring service.

How the scam works

Secret Shopper scams have two goals: to persuade the victim to wire stolen money and to obtain the victim's personal information - ID Theft.

A Secret Shopper scam always involves receiving a check or money orders.  It always involves cashing the drafts or depositing them in your checking account, then wiring the money by MoneyGram or occasionally Western Union to a stranger.  Many victims are told to go to Walmart to wire the money.

The scammers don't want their victims to be warned off by the money wiring service so they instruct the victim to say they the money is being sent to a relative.

The victim has now become involved in money laundering.

Just about every Secret Shopper victim who comes to us states that the check or money order looked genuine, even to the bank or check cashing store.  Well that's because the check stock is genuine.

The drafts are written on stolen stock or on paper that has been reproduced by a professional counterfeiter on a printing press using the same methods as check printing companies use.  With the right software and ink for the micro encoding at the bottom of the draft, drafts can be reproduced on a home printer.

Sometimes the drafts have been washed, meaning the original Payee and amount was chemically removed.

One trick the scammers use is to send out counterfeit drafts on which the routing number, account number, and bank name do not match.  This means the draft has to go through special handling, causing a delay in the return of the check.  The delay gives the scammers time to send the victim more checks before the scam is discovered.

How to really verify checks and money orders

The average person does not view and touch very many different drafts.  They have their own checks, receive a paycheck unless they are on auto-deposit, occasionally get a rebate check or refund from a store, may send off money orders from time to time, and at least once a year receive a Treasury check.  That is far too few to be a good judge of whether a check is genuine or not.

DO NOT DEPOSIT A CHECK TO SEE IF IT IS GOOD, EVEN IF YOUR BANK TELLS YOU TO!

That is not how you verify a check and by endorsing and depositing a suspicious check or money order you are putting your account and your standing with your bank at risk.

Although tellers handle many, many drafts during during the day, their ability to discern a counterfeit draft is also limited.  Some banks and credit unions have machines to reveal the security features incorporated into some check stock, but that only works for drafts that have been re-printed without the security feature.

Contacting the bank to see if the check is good only provides the information that the account is open, that there are no flags on it (and flags are not always noticed), and that there's money in the account.

Waiting for a deposited check to clear is meaningless.  "Cleared" only means a draft made it through the clearing house which provides the same information you get by calling the bank: account status.

The real question is, was that check was made out to you?

The only way to verify a check or money order is to contact the account holder and ask that the draft be verified against the ledger: was it made payable to you and written for that amount?

All draft accounts have a ledger, even cashier's checks.  If you receive a cashier's check, you can contact the issuing bank and ask that it be verified against the ledger.

What "available funds" really means

After you have deposited drafts, you will see a line on your statement that states "available funds."  On the other hand, you may call in to find out what your account balance is and find that it includes the amount of your deposit.

All that means is your bank has obeyed the 2-day rule and credited your account with money.  The key word here is "credited."  It does not mean your bank has received funds from the account holder bank.  It means you have been given a no-signature loan against the receipt of funds from the account holder bank.

It also means that if you withdraw those funds and the draft comes back for any reason at all, you owe the money to your bank.  You, not your bank, are responsible for those drafts according to the signature card you signed when you opened your account (your contract with your bank) and by your endorsement on the back of the draft (your acceptance of total responsibility for the draft).

To find out what to do if you have already received or accepted one or more suspicious checks or money orders please go to www.fraudaid.com/before_contact.htm immediately and scroll down to Counterfeit checks and money orders.

If you have been arrested for cashing or depositing a counterfeit check or money order, please contact us immediately at

If you have been corresponding with a fake Secret Shopper employer, please go to Your ID Theft Prevention To-Do List now.