Cheque Fraud
In 2005 cheque fraud losses totalled £40.3 million, a decrease of 13% on 2004.
A typical cheque fraud involves a criminal buying goods or services and paying for them with a stolen or counterfeit cheque. The seller waits for the the bank to confirm the cheque has cleared and the parts with the goods. When the fraud is subsequently discovered the funds may be reclaimed.
Over the past couple of years organised gangs have targeted consumers selling high-value goods such as cars. Typically the fraudster will offer you a cheque or bankers’ draft for more than the price of the goods. You are then asked to transfer the amount of the overpayment to a third party after three days, when, it is claimed, the cheque will be cleared.
The cheque or draft isn't genuine and, whilst banks do all they can to stop such cheques in the clearing system, it may only be after you have received value for the cheque that the genuine cheque owner discovers that money is missing from their account. Consequently, the money paid into your account belongs to them and you may be obliged to repay it. This can happen several weeks after the money has been paid into your account by which time you have probably transferred the "overpayment" and handed over the goods you are selling.
The banking industry continues to identify most of these fraudulent/stolen cheques as they pass through the cheque clearing system and before there are any victims. Currently, the industry identifies and stops more than 90% of all fraudulent cheques, thereby preventing customers losing cash. Attempted cheque fraud levels amounted to £631 million in 2004 and £575 million in 2005.
We also are working closely with the police to help minimise the risk of this type of fraud, but the important thing is to be on your guard: anything that sounds too good to be true should set alarms bells ringing, even if the excuses given seem plausible.
