Recently Jared Wilkes Post was sentenced in the Alaska Federal Court to prison for defrauding banks and people of more than $100,000 through a sophisticated check kiting scam. For four years Post contact people on social media and convinced them to share their bank account information. Post told his victims that he didn’t have a bank account and he needed to deposit a legitimate check into his victim’s account who he then told that he would pay them a portion of the check for allowing him to use their bank account. Once the check appeared to clear, Post told his victims to pay him through some form of a cash app or a Western Union funds wire.
The truth is that the checks being deposited were stolen and altered, however, the banks would not discover this fact until after money had been withdrawn and paid to the scammers, leaving the banks and the individual bank account holders at a loss. The provisional credit initially given by the bank in the initial days after the deposit of the check may have made it appear to the individual victims of the scam that the check had cleared, but when the fraudulent nature of the check was later discovered, the provisional credit was removed from the account, leaving the account holder having paid his or hers own funds to the scammer.
The two lessons of this scam are first, that you should never allow anyone else, particularly someone you do not know, to use your bank account for any purpose. There are multiple ways for someone who does not have a bank account to cash a check without your getting involved.
Second, it is critical to remember that whenever you deposit a check, the provisional credit you are given, a few days after deposit may make it appear as if the check has cleared, but the provisional credit is as the words imply only provisional. As soon as the check fails to truly clear, the provisional credit is removed from your account and if you have paid funds relying on the provisional credit, you have lost those funds out of your own money when the check eventually bounces. Never consider a check to have cleared until it has actually totally cleared which can take weeks.
If you are not a subscriber to Scamicide.com and would like to receive daily emails with the Scam of the day, all you need to do is sign up for free using this link. https://scamicide.com/scam-of-the-day/