Posts Tagged: ‘provisional credit’

Scam of the day – September 26, 2013 – Mystery shopper scam update

September 26, 2013 Posted by Steven Weisman, Esq.

The mystery shopper scam is a tried and true scam that scammers still use to steal their victims’ money because the scam still works.  Recent reports have surfaced about the mystery shopper scam turning up in the Cleveland area, but the scam is found throughout the country.  The scam begins when you are contacted by mail or email purportedly by a company asking you if you want a job as a mystery shopper who will be paid to shop at their store and then report on the shopping experience to assist in market research and improving customer relations.  The pitch sounds legitimate and often the emails and letters appear to be legitimate although it is easy to counterfeit a company’s logo and stationary.  Once you agree to be a mystery shopper, you are sent a certified bank check for an amount such as $5,000 which you are asked to deposit in your checking account and use the money to make purchases that you are allowed to keep.  You are then instructed to send the remaining funds back to the company.  Some victims, believing they were being careful deposited the check and thinking that they were being exceedingly careful, waited a few days for the check to clear.   They then wire the funds, as requested back to the company only to learn a few days later that the certified check sent to them was a counterfeit and their bank had only given them provisional credit for the check into their account.  Once the check is found to be a fake, the provisional credit is removed from the victim’s account and the victim has lost the money that he or she wired to the scammer.


One reason why this scam works so well is that there really are mystery shopping jobs although the actual number is quite few and they do not go looking for you.  If you want to find out if a mystery shopping company is legitimate, you can contact the Mystery Shopping Providers Association which is a trade organization of legitimate mystery shopping companies.  Their website is  Other indications that you are involved with a scam is when you receive a check for more than what is owed you and you are asked to wire the difference back to the sender.  This is the basis of many scams.  Whenever you receive a check, wait for you bank to tell you that the check has fully cleared before you consider the funds as actually being in your account.  Don’t rely on provisional credit and never accept a check for more than what is owed with the intention to send back the rest.  That is always a scam.  Also be wary whenever you are asked to wire funds because this is a common theme in many scams because it is difficult to trace and impossible to stop.

Scam of the day – August 12, 2013 – Global Processing Inc lottery scam

August 12, 2013 Posted by Steven Weisman, Esq.

Lottery scams are one of the most effective scams and with good reason.  Who wouldn’t want to win a lottery?  One of the lottery scams presently being reported begins when you receive a letter from a company called Global Processing, Inc. although I should caution you, this same scam is done under other names, as well.  The letter informs you that you have won a large sum of money, such as $250,000 and also comes with a check, sometimes certified for $4,686 to help you pay the required processing fee of $3,250 in one version of the scam presently being circulated.  The check looks good and if you deposit it, your bank may appear to indicate to you that the check has cleared in a few days so you can feel confident sending your own check for the processing fee.  However, banks are required to give only provisional credit after a few days and when the counterfeit check ultimately bounces, the bank removes the money from your account and you are left having sent your own money, usually by wire, to a scammer.


It is very hard to win a lottery.  It is impossible to win a lottery that you have not entered.  If it is a foreign lottery, it is illegal for Americans to play foreign lotteries.  As for the crux of the scam, no legitimate lottery requires you to pay processing fees and if they were going to provide money to you to pay for the fee, why wouldn’t they merely deduct that amount from your winnings?  It just doesn’t make sense.  Don’t let greed blind you from common sense.  The payment of a check in an amount more than is due and then asking you to pay the difference is the basis of many variations of this scam.

Scam of the day – May 2, 2013 – Craigslist scam update

May 2, 2013 Posted by Steven Weisman, Esq.

Often I will remind you about particular types of scams I have mentioned before because they continue to victimize many people.  Earlier this week a Pennsylvania man became a victim of a common Craigslist scam when he put an ad on Craigslist to sell a piece of furniture for $350.  He was contacted by someone who sent him a check for $1,350 and asked the seller to merely deposit the check, deduct the $350 and send the rest back to the buyer by way of a money order.  The check looked legitimate so the seller deposited it and sent the difference back to the buyer.  Unfortunately, the check was a forgery so the seller lost the money he sent to the scam artist posing as a buyer.  Often in these circumstances the check will appear to be a bank check or a certified check, but it is just a forgery.  Other times, the sellers will think they are being prudent by waiting a few days for the check to clear only to learn later that it can take weeks for a check to fully clear and the provisional credit that they are given by the bank after a few days does not mean that the check was not a forgery because once it is recognized as a forgery, the provisional credit is taken away by the bank and the victim is left with a reduced bank account.


Whenever you are paid for something that you are selling by a check for more than the amount that is due and that payment comes with a request for you to send the difference back to the buyer, you should consider this a sign that this is a  scam.  Also, anytime you are paid by a check you should wait for the check to fully clear before turning over the sold goods.  Even if the check appears to be a bank check or a certified check, it may well be a forgery so you should contact your bank to make sure that the check has fully cleared before you consider the payment to have been made.  Regardless of the excuse that may be given to you as to the reason for payment by way of a check for more than what is owed, you should be suspicious.  Finally, always be wary when someone requires you to send payment by Western Union or wired from your bank because once those payments have been made, it is impossible to get the money back.


Scam of the day – January 2, 2013 – Phony sweepstakes and contests

January 2, 2013 Posted by Steven Weisman, Esq.

January is a big month for phony sweepstakes and contests although, quite frankly, every month is a big month for such scams, however, January leads the way because many legitimate sweepstakes and contests declare their winners in January.  Often the scam starts when you receive an email or a regular mail communication congratulating you on having won a contest or sweepstakes that you never even entered.  You may next be told that you are required to provide some personal information, such as your Social Security number in order to claim your prize, or you are told that you have to pay the sweepstakes sponsor income taxes on your winnings or you are required to pay some administrative fees in order to claim your prize or perhaps, you even receive a bank check that is the first installment of your winnings; you are then told to deposit the check and pay taxes or administrative fees back to the sweepstakes sponsor from the first check.  In all of these scenarios, you are in serious jeopardy of identity theft or being scammed out of your own money.


The first thing to remember is that you never win a contest you did not enter.  That, right away, should be enough for you to recognize that the contest is a scam.  Many of these phony lotteries appear to be foreign.  Participating in foreign lotteries is a violation of federal law and, again, the chances are pretty substantial that you are hearing from a domestic or foreign scam artist, not from a legitimate foreign contest sponsor.  If you provide your personal information, such as your Social Security number to the scammer, you will end up a victim of identity theft.  It is true that lottery winnings are subject to income tax, but the sponsor of a legitimate contest either deducts the taxes from your winning directly  before you receive your money or,  most commonly, they give you your winnings and it is your responsibility to pay the income taxes.  They don’t collect income tax payments from you on behalf of the IRS.   As for that legitimate looking bank check that you might receive, it is a forgery.  Federal law requires banks to give provisional credit to cashier’s checks or other forms of bank checks by the next business day after the check has been deposited.  However, this credit to the depositor’s account is merely provisional and when the check eventually bounces, which may take weeks, the victim loses the credit for the money he thought he was depositing into his account as well as the money that he paid from his own bank account to the scammers.  Most people don’t know what provisional credit is so when it appears to them that the deposited check has “cleared” they think they are safe when they most assuredly are not.  If you want to investigate a check’s legitimacy, contact the bank that it appears to be written from and inquire as to whether it is legitimate.  You will find that it is not.

Scam of the day – September 28, 2012 – Mystery shopper update

September 28, 2012 Posted by Steven Weisman, Esq.

A tried and true scam that continues to effectively steal unsuspecting victims’ money is the mystery shopper scam.  Part of the problem is that there are legitimate mystery shopper companies that hire people to do market research for major companies by shopping in their stores and reporting on the experience.  Unfortunately, the real mystery shopper jobs are few and far between while the scams are everywhere.  The manner in which the scam works is that when you answer an  advertisement or an email to be a mystery shopper, you are sent a bank check for you to deposit and use for your shopping.  You spend some of the money on the goods that you purchase which you are allowed to keep and also are able to keep more of the check as the payment for your services and then you return the balance.  The problem is that the check is counterfeit, but the money you send by wire from your own bank account is legitimate and you lose that money.


The New York Attorney General has recently shut down two mystery shopper websites, and  Real mystery shopper companies will not seek you out by email.  People often are fooled when they deposit the real looking check and wait for it to clear in a few days only to learn too late that the check did not clear, but that they had only received provisional credit which makes your account look like it has money in it when it really does not and once the check fails to clear, the provisional credit is removed and your account is out the money that you sent thinking the check was good.  Also, always be wary of any transaction that requires you to wire the money.  That is a major sign of a scam because the money is impossible to get back after it has been wired.


Scam of the day – September 25, 2012 – Student housing scam

September 25, 2012 Posted by Steven Weisman, Esq.

With the opening of the Fall college semester many landlords in college towns across the country have been targeted by scammers around the world in a scam that is simple and effective.  The “student” calls the prospective landlord in response to an advertisement or listing that the landlord has placed in regard to rental housing.  The student then sends a certified check for the full year’s rent, which the landlord deposits.  A few days later, after the check has cleared, the student calls the landlord again and informs him or her that his or her plans have changed and that he or she will be attending a different school in a different city.  The student then asks for the landlord to return the unused portion of the rent check.  All too often the landlord complies and sends a check only to learn that the original check given to the landlord was counterfeit, but unfortunately the check or wired funds sent by the landlord are good and the landlord has been cheated out of thousands of dollars.  In another variation of this scam, the check is sent allegedly by the student’s parents with extra money for the child for moving expenses or other expenses of the child and the parents ask the landlord to send the balance of the check above the rental amount to the child at a provided address or bank account.  Often the scammer requests that the landlord wire the money.


Always be wary of requests to wire funds.  This is a common tactic of scammers because once money is wired, it is almost impossible to get back.  The key to the student housing scam is that the landlord trusts the certified check and then believes he or she is prudent by waiting a few days for the check to clear before returning money to the scammers.  The problem is that banks only give provisional credit for the amount of the check after a few days.  The full check clearing process takes a week or longer and even if you were given provisional credit, you will still be responsible for the funds that you send from your bank account to the scammer.  Once the check is found to be counterfeit, the entire amount is debited from your account.  If you get a bank check, call the bank that issued the check to confirm it is legitimate and do not release any funds from that check until your bank tells you that it  has fully cleared.

Scam of the day – September 12, 2012 – Lawyer scam

September 12, 2012 Posted by Steven Weisman, Esq.

Later this Fall, Nigerian Emmanuel Ekhator will be going on trial in the Federal District Court for Pennsylvania on charges that he stole more than 32 million dollars from lawyers using a simple, but effective scam against law firms that should know better.  The way the scam works is that American law firms are contacted by people claiming they need representation collecting a lawsuit settlement check.  The law firms that fall for this scam collect the settlement check in the form of a bank check, deposit the check in their firm’s escrow account, deduct their fee and wire the remainder to the “client.”  Many of these scams have been traced to Nigeria and to Nigerians living in Canada as well as Japan and South Korea.


This scam works on the same basis as the mystery shopper scam where the victim receives a counterfeit check, deposits the check into his or her account and then sends some of the money from the check back to the scammer.  The key is that a bank will give provisional credit for the check in the account of the victim after just a few days so it will appear that the check has been cleared, however, the check does not officially clear, or in the case of a counterfeit check not clear for a few weeks after which time the provisional credit is rescinded and the victim is left having wired good money of the victim to the scammer.  The key to avoiding this scam is to contact the bank issuing the check deposited by phone to make sure that the check is legitimate and that there are funds to cover the check in that account.  Further, do not send any funds in such a situation until the check you are given has fully cleared.

Scam of the day – July 5, 2012 – Home Depot contest scam

July 5, 2012 Posted by Steven Weisman, Esq.

Recently Jode Ventura of New Bedford, Massachusetts was lucky enought ot win $150,000 in a lottery conducted by Home Depot, a store where she frequently shopped.  The contest was from their British office and said, “We are pleased to inform you that you are one of the declared winners of a mega lottery conducted in UK.”  Inside the letter was the first payment of her winning, a bank check for $3,980.  The letter also required Ventura to send back  a check for  for $1,995.  Fortunately, for Jode Ventura, she went to the Massachusetts Attorney General’s office where to Jode’s surprise, she was told that it was a scam and did not fall for it.  Others have not been so lucky.


As I have warned you many times.  It is hard enough to win a lottery you have entered.  It is impossible to win one that you have not entered.  Foreign lottery scams are one of the most common scams today and they all share one thing in common that should be a tip off to you if you receive a notice that you have won a foreign lottery – playing foreign lotteries are illegal under Title 17, Part I, Chapter 95 , Section 1953 of the Federal Law.   Many people who receive these checks think they are being smart by waiting for the check to clear before sending back any money.  Unfortunately, they do not understand the rules of provisional credit under which, their account will be given temporary credit for the check after a few days while it goes through the more lengthy clearing process.  It will appear that it has cleared, but it has not and this will come back to haunt the victim when the check ultimately bounces after a few weeks, but the check that the victim has sent does not bounce.  Finally, taxes are never collected by the operators of legitimate lotteries.  They either deduct the income taxes from your winnings, or more often they leave it to you to pay the income taxes.

Scam of the day – April 23, 2012 – Car logo advertising scam

April 22, 2012 Posted by Steven Weisman, Esq.

Many scams lure us in because they seem so close to legitimate business opportunities.  It is true that companies pay people to advertise their logos in vinyl decals on individuals’ cars.  The vinyl decal is called an auto wrap and there are companies that legitimately pay for this service.  Unfortunately, there are also a number of scammers out there now representing themselves as working for Coca Cola, Monster Energy drink, Carsberg beer, Heineken beer and Red Bull.  But they do not work for these legitimate companies.  They are scammers.   They send you, the victim, a bank check or money order and instruct you to deduct your  payment and send the balance to a designated graphic designer who will be preparing the logo.  This is a typical scam where you are provided a check for more than what is owed you for whatever the service is and then instructed to send back the difference.  The problem is that the check to you is inevitably counterfeit, but the money you wire from your account is real and money that you have lost.


Never get involved with any deal where you have to send back money where you are told you are being sent an overpayment.  And don’t trust your bank when it tells you that you that the check has cleared.  What you initially received from your bank is only provisional credit after a few days.  It can take weeks for the actual check to be discovered to be counterfeit.

Scam of the day – March 13, 2012 – Law firm scam

March 13, 2012 Posted by Steven Weisman, Esq.

According to a report released yesterday by the FBI, a number of law firms have been victimized by a scam in which the law firm receives an email from an overseas business seeking to hire the law firm to collect debts owed to the overseas company.  A standard retainer agreement is sent by the overseas company along with a certified check.  The law firm is instructed to deduct its initial retainer costs and wire the remainder of the funds back to China, Korea, Ireland or Canada, typically.  Of course, for regular scamicide readers, you have already guessed that the “certified check” was counterfeit and that even if the law firm waited the few days for the check to receive provisional credit from the bank where the law firm deposited the check, the check ultimately bounced and the money wired from the law firm to the overseas company is gone forever.

In another variation of this scam, the initial solicitation comes from a lawyer in another country seeking assistance with a collection.  The scammers use the names of real attorneys so if the American law firm checks out the legitimacy of the foreign lawyer, it would appear to check out.  Of course, if the American law firm actually called the foreign lawyer, they would learn that it was a scam.


The essence of this scam and many other scams is an overpayment to you of an apparently “certified check” where you are asked to send the diffference to the scammer.  There is never a reason to accept an overpayment check.  That is a red flag that there is a scam involved.  If you do accept a certified check, always contact the issuing bank to make sure that the check is legitimate and even then, do not consider the transaction as being complete until the check has fully cleared and not just provisionally been cleared.