Learn how to prevent check fraud and scams

When a check clears, it means that the funds have moved from the payer’s bank to your bank, and usually the funds become available to you not long after. Some checks clear within two business days, but others can take seven business days or longer.

Why might a check take longer to clear?

Delays usually happen when:

• You’re depositing a large number of checks in one day, especially if they exceed the total available balance in the account.
• You’re a new customer
• Your account has frequent overdrafts over the past six months.
• Deposits of checks have already been returned unpaid.
• Your bank suspects the check won’t be paid.

Some checks can take longer to process, so your bank may need to hold some or all of the deposit for a little longer. Wells Fargo will let you know if we need to hold a deposit and include details about when to expect your money. If you think a check you deposited is fraudulent or fake, let your bank know right away.

Wells Fargo makes every effort to ensure that our customers’ money is safe. Awareness and vigilance are key to combating check fraud and scams. If you do see something of concern, contact Wells Fargo online, call us at 800-869-3557, or contact your financial institution and ask them to investigate and take appropriate action.

A woman in Georgia received an email from an individual who wanted to purchase furniture from her late aunt’s estate sale. She later received a check in the mail from this person for twice the amount of the furniture with a note asking her to pay the difference to a specific moving company and keep the remainder of the money “for her troubles.”

Does that sound too good to be true? It was. A Wells Fargo banker found red flags when she reviewed the check and customer’s emails: The name on the check did not match the name on the emails, and the address on the check was in a different state than the buyer said they lived. Sure enough, the banker investigated and discovered that the check had previously been cashed.

Scenarios like this one are becoming all too common. Although the use of paper checks has declined more than 7% per year since 2018, reports of check crimes (PDF) have almost doubled from 2021 to 2022. “As digital payments have become more secure, we’re seeing a significant increase since the COVID pandemic of fraudsters targeting paper checks to get people to unwittingly participate in a scam,” said Joe Bernardo, Wells Fargo head of Fraud & Claims Operations. “It’s easier to counterfeit a check than to break into someone’s online profile and send a fraudulent wire.”

According to the American Bankers Association, unprotected checks can offer criminals your name and other contact information, account and routing numbers, and even your signature to be forged on other documents.

Due to the increase in check schemes, Wells Fargo discourages the use of checks when possible. If you must use a check, here are ways to help you stay ahead of scammers.

First, know that check crimes boil down to two types of attacks: fraud and scams.

Fraudsters use the following methods to manipulate checks, which they present to a bank to be cashed or deposited into their own accounts.

• Check theft: Thieves acquire checks through normal day-to-day commerce, by stealing them out of personal and U.S. Postal Service mailboxes or even obtaining customer account and routing numbers through phishing scams. They endorse the checks or make a copy with their own information on it.
• Check washing: Criminals use chemicals to “wash” or erase the original ink on the check to then change the amount and/or payee.
• Check forging: Criminals create fake or counterfeit checks using legitimate routing and account information.

According to the American Bankers Association, fake checks are one of the most common instruments used to deceive customers. The scam almost always involves someone sending you a check in exchange for some goods or services that is “accidentally” in an amount that is greater than what you need. They may make a plea for you to send the extra money back so they don’t lose their job. They may ask you to wire money to a foreign country, purchase gift cards, or mail cash.

“If you receive a check for more than you expected, take a pause,” said Bernardo. “It’s a tell-tale sign of a scam, so don’t deposit or cash it.”

Lately, check scams have come in the following flavors:

• Online marketplace sales: You post something for sale. The buyer sends you a check for more money than you expected. If you send out the item, you’ll be out the goods plus responsible for any of the funds that you spent.
• Social media: An artist or photographer messages you about a photo you posted, offering you money for the rights to use it. They’ll send you a check, then ask that you send some of the money back for supplies or similar.
• Lottery or prize: You receive a check in the mail for lottery or sweepstakes winnings. The check comes with instructions that you to send back a portion of the winnings to cover taxes, shipping charges, processing fees, or similar.
• Investment: You are alerted that you have a significant investment that’s made a profit, and then you are sent a check. Once you deposit the check, you are told that to cover the taxes or to access the funds, you’ll need to send money.
• New job: You interview with a company or an individual, either for an on-site or work from home assignment. After sending you a check as a signing bonus, they instruct you to deposit it and send back a portion or overage. Or you may be asked to purchase equipment and then ship it to an address that the fraudster has access to.
• Hardship scams: You might be approached by a new person at your job who says they haven’t had time to open a bank account, or even a stranger at an ATM who says they forgot their card at home — either way, their request is simple. They offer to sign over their check or a money order and ask that you cash it for them as a favor. They may even offer for you to keep some of the money for your trouble. The check or money order turn out to be fake, and you’re out the money.

Easy ways to avoid check schemes

Bernardo shares these prevention tips:

• Use secure digital payment alternatives, such as online or mobile banking.
• Set up account alerts¹ so you’re notified of activity.
• Write in non-erasable black ink.
• Keep checks secure so they cannot be stolen.
• Don’t accept checks from people you don’t know.
• Don’t accept or cash a check for more than is expected.