Friends of Mrs Gob run a B&B. They got an email from someone wanting to make a 4 week booking in February, stating they were US based but were currently working in the UK. This seemed strange to them in itself.
The "guest" then sent a US bank cheque, which they submitted into their bank.
They have now had an email about illness and needing 75% of the amount transferred to a bank account, leaving 25% as a deposit.
Now as it obviously a scam, but how does it work?
Do the scammer hope that a transfer is made before the funds have cleared and then the cheque is found to be fraudulent or stopped? I cannot work out how this one is meant to work.
Have the scammers obtained a stolen cheque and are they looking to launder it?
If they don't do anything and the cheque is fully processed and cleared what happens?
Seems strange to me and I can't work it out!
I think you've got it. The scammer hopes you'll transfer the refund (probably via Western Union or other unretractable method) before his cheque bounces.
Errrr! The cheque isn’t genuine.
Presumably the cheque will appear to clear a few days before the verification process is completed with the 'home' bank in the US.
Looking it up, it seems that if fraud is eventually uncovered, the funds can be taken back up to seven years later! It really isn't the safest way to receive money internationally...
Is the destination a/c for the refund the same as the checking a/c?
Don't accept the booking and phone the bank first.
Errrr! The cheque isn’t genuine.
Apparently the bank cashier said that it all looked legit. So I guess it must be stolen?
Presumably the cheque will appear to clear a few days before the verification process is completed with the ‘home’ bank in the US.
This is what I assumed. However, I have no idea how long "verification" takes. I know it used to be 3 days for a UK cheque but how long for an overseas transaction?
Apparently the bank cashier said that it all looked legit. So I guess it must be stolen?
I could write you a cheque now for £1m but with 2 problems, my cheque is for an account that no longer exists and I’m a few pennies short of £1m.
the cheque clears but is then cancelled and the originating bank reclaims the money which is allowed despite it appearing you have the funds
Apparently the bank cashier said that it all looked legit.
I had a similar thing a few years ago when self employed.
“Yorkshire Water” paid for some work in advance by cheque. I banked it and surprisingly it cleared.
Was very suspicious but I was in no way inconvenienced at this point.
Before the work was due to start it was delayed and they asked for 50% to be refunded and the rest left as a deposit.
I declined and said they had paid and I was
Willing to do the work as agreed. I never heard from them again. And 2 weeks later the bank confirmed that the cheque was stolen and the money was refunded.
This is why I have to inform foreign clients that cheques drawn on a UK bank are the only acceptable ones for us at work. Anything else just leaves it all too uncertain for safety.
Horrible situation. they have paid for a booking so your friends theoretically can't let it to someone else but you can be sure that the cheque will bounce. I would call the US bank to verify that all is well with the cheque. If it is then the payment is to the US bank it came from only.
I know it used to be 3 days for a UK cheque but how long for an overseas transaction?
Potentially, weeks. Tell them to only do the refund, if they want to do the refund, once the cash has cleared.
Oh, and tell them not to accept foreign cheques in future.
Oh, and tell them not to accept [s]foreign [/s]cheques in future.
Quick update, speaking to them last night.
Well the money "cleared" and is in their bank account. They are going to call 101 and report it as a fraud.
Not sure what will happen next.
I told them that I would say nowt and just sit on the money and see what happens. Although I guess I'm not as honest as them.
It's 100% a scam. Plus, a four week booking?! Very convenient as that makes 75% a fair chunk of cash.
It's just a twist on the 'I'm a Nigerian prince and I need to transfer my money out of the country, let me pay you a million and then you forward £500k to my associate, and you keep the other half', or the more believable, 'forward some cash to my courier to pay for the collection of your mountain bike'
Standard fake or stolen cheque scam. The money can be recovered by your bank months after it clears into your account - even with English bank cheques it’s the same if they turn it to be stolen or fake. Clearing only means it’s been processed through the system and money has been moved around. As the cheque moves through the system it’ll eventually be detected as fake/stolen and the money will be reversed so if you have paid the difference back to the scammer you loose out twice.
They know it's a scam.
They have no intention of transferring any money.
I'm interested in what action, if any, will be taken by the bank and police.
I guess it's so common that there will be very little interest.
I would imagine the cheque will show as stolen in the next couple of weeks.
Ask for an address to send a bankers draft? If it’s genuine the check will clear and then your friends can send back the 75%. If it’s not you won’t hear from them. Give it 2 weeks for ‘processing’.
Edit - I suspect he bank, police will just remind your friends to be virulent and claim that as their action.
I’m interested in what action, if any, will be taken by the bank and police.
None as there’s zero chance of finding the culprits.
Some complex scheme to bum your dog.
US bank cheques take 6-8 weeks to clear (cheques have to be physically sent back to the US). This make this scam work since if you send the deposit back before the funds are cleared the scammers have lots of time to disappear with your money. Also incidentally when you cash a US cheque you get in writing a warning from the bank that the funds can be claimed back up to 5 yrs after the cash was paid out. I presume by the IRS.
Exactly as tonyg just said.
The US banking system is fragmented. not joined up and relies on physical paper being moved about. Its as far away from the European system as can be. A US cheque from a mid-west bank can easily take 3 months to fully clear in a UK bank account and as described above due to tax laws can be reclaimed many years later. Never accept one unless you know the account holder very well.
I’m interested in what action, if any, will be taken by the bank and police.
Likely nothing - just report it to Action Fraud (who could possibly use it as part of a larger case but even that's unlikely for a this sort of cheque clearance fraud)
Transfers to an IBAN number only ?