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For our flow chart of a Payment Processing Scam, visit our partner site .NextWebSecurity

Payment Processing Schemes Flowchart

 

 

 

 

    

    
 

The Truth vs. The Scam: Payment Processing, Re-shipping, Forwarding Scams

 

Work at home processing or reshipping checks, money orders, envelopes, and/or merchandise; receiving money wired into your account; writing checks on somebody else's account; secret shopper jobs; forwarding cash received in a package, by mail, by Western Union or MoneyGram; and receiving credit cards or gift cards from a foreign employer or someone you met online.

 

1. The Scam | The Truth: 2. Overview 3. Forwarding packages and/or payments 4. Money wired into your account & re-wiring Western Union or MoneyGram payments 5. Writing checks and forwarding checks and sealed envelopes 6. Secret Shopper jobs and forwarding cash 7. Receiving credit cards or gift cards

 

  THE TRUTH: Overview

 

 

 

If you accept a job to forward money or packages, you are setting yourself up in business as a forwarding agent.  That means you must have a license to do so, must be bonded and insured, and abide by the laws of your country, state, county, or Province for such activity.  You must account for each item you forward, keep books, file tax reports, etc.

 

Western Union and MoneyGram were designed to send money to friends and family, not to send money to strangers.

Once the money is picked up, it is gone forever.

NEVER WIRE MONEY TO A STRANGER!

 

Any company or individual, anywhere, can open a a bank account in another country to process payments made in that country. More and more international payments are made electronically with no intermediary required.

Example: If ABC-US, Inc. has a large customer base in the UK an needs to accept hard copy payments from those customers, it would open a UK bank account. 

It would then hire a licensed and bonded accounting (or bookkeeping) firm in the UK to accept Euro payments, depositing checks made payable to ABC-US, Inc. into the company's account located there in the UK.  The accounting firm would not be able to make withdrawals from the account or write checks on the account. 

The accounting firm would file ABC-US, Inc. tax forms for UK taxes (signed by an ABC-US company officer) and provide an accounting of UK expenses to ABC-US .  The accounting firm would be paid by check written on the UK account and signed by an ABC-US officer.

No unlicensed and unaudited individual would ever be involved.

As part of the alleged job, any money you send to a designated bank, foreign or domestic, does not sit in the account for very long nor is it easy to get back even if it is still sitting in the account.  For instance, if you send money from your bank to an Asian bank, even if your bank contacts the Asian bank to retrieve the funds, in most instances the return of the funds will be refused.  The same is true of banks on many countries.

 

You must pay your taxes on all income, including any commissions earned, regardless of where or how the commissions were obtained and regardless of the geographical location of those paying you the commissions.

You are 100% responsible and liable for any check or money order you endorse and cash, and for any funds placed into your bank or credit union account, whether you deposited the money or someone else did.

By law you must repay the bank, credit union, or store when you have deposited or cashed checks or money orders (drafts) that proved to be of no value.  It is the same in all countries, at all financial institutions and stores. 

Your signature on the back of a draft is a contract stating that you take full legal and financial responsibility for that draft.   This is called an endorsement, meaning you endorse or approve of the check because you have personal knowledge that the draft is good and true.

When you opened your account at a bank or credit union, by signing the signature card you agreed to be take full legal and financial responsibility for anything that is deposited into your account by you or anyone else.

Cleared checks: "Clear" is only bank lingo for a draft (check or money order) moving through a system designed to debit an account at one bank and credit an account at another bank.  The system is generically called the Clearing House and there are many throughout the US and other countries.

During the process, the account that is being debited is electronically checked to ensure that the account is open, that there is enough money in the account to cover the draft, and that there are no flags on the account that may affect the deduction of the specified amount.

The Clearing House does not verify that the account holder whose account is being debited actually wrote the check or authorized an electronic check (ACH).  An account holder has up to 12 months to report an unauthorized draft to his bank.

Because it is incumbent on US banks to make funds available to their account holders as soon as possible, banks will credit an account holder's balance with the amount of a draft before it receives the credit from the bank on which the draft was drawn. 

When you see "funds available" or "funds pending," it means that you have been given a provisional loan from your bank.  If the draft is returned as invalid for any reason, your bank has the legal right to sweep all funds from your account, including any automatic deposits you receive from employer or government sources.

Nigerian and Former Soviet Union scam network chiefs have a better understanding of the banking system than most bankers and use that understanding to full advantage to rob individuals and banks worldwide to the tune of amounts totaling billions of dollars.

Money sent by Western Union or MoneyGram is untraceable once it has been picked up.  Funds sent by this method can be picked up at any Western Union or MoneyGram office regardless of where you sent it.  This is not how business is conducted. 

Exception: some companies, such as car loan companies, have Western Union and MoneyGram numbered accounts specifically designated to receive payments for that company.  This maintains the money trail (paper trail).

If you are the victim of a Payment Processing Scam, please know that your name may be used to open fake eBay accounts and Classified ads selling non-existent products.  The payments you are receiving may be from people who believe you are selling product on the Internet or through a local newspaper and they will be waiting for delivery.

 

1. The Scam | The Truth: 2. Overview 3. Forwarding packages and/or payments 4. Money wired into your account & re-wiring Western Union or MoneyGram payments 5. Writing checks and forwarding checks and sealed envelopes 6. Secret Shopper jobs and forwarding cash 7. Receiving credit cards or gift cards

 

 

 

 

 

 

We are not attorneys and don't pretend to be.  In our experience, the information and guidance offered on this site have proven to be effective; however, we always recommend that you consult with an attorney.

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