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Sellers Beware: Check Overpayment Scams on Seniors and Others

Online Estate Items Targeted

Florence Klein
Courtesy of Florence Klein

Online classified ads and auction sites are still growing in popularity and most papers still have their printed classified sections. Today’s economy seems to have more people buying and selling and more people looking to scam someone else out of their money using check overpayment scams.

Getting cash for estate items or money for things we no longer need or want are good candidates for online sales or auctions but you need to take some care to avoid getting caught in what the Federal Trade Commission (FTC) calls Check Overpayment Scams. Check overpayment scams involve payment checks that are made out for more than the selling price.

A check overpayment scam goes something like this:

  • The seller gets an offer for the purchase of the item for sale
  • The alleged buyer offers payment with a personal, corporate or cashier’s check
  • The so-called buyer then makes up a reason for making the check out for more than the selling price
  • The supposed buyer asks the seller to wire back the extra money after the check has been deposited
  • The seller cashes the alleged buyer’s check and sends the extra funds back to the "buyer"
  • The scam overpayment check bounces leaving the seller with less money than they started with and maybe some bank fees as well

A check overpayment scam works in part because of the way deposited funds are handled by banks. They also work because the counterfeit overpayment checks look good enough to fool unsuspecting sellers and bank tellers. Not to mention ATM deposited checks.

The overpayment scam is out there but do not give up on getting cash out of your extra items online or with a paper classified just follow a few guidelines and you will avoid the bad check trap. Here are the basic rules:

  • Do not accept a check for more than your selling price- ever!
  • Accept checks only from local banks (or with a local branch)
  • Look into alternatives to check payment - there are escrow and online payment systems available - See OnGuard Online for more tips to keep you safe
  • Refuse the deal, no matter how good, it the buyer insists on you sending some money back or uses any high pressure, act now buying tactics
Remember if it feels wrong or too good to be true it most likely is and pass it by.

Contributor Julie Hall offers tips if you have items you wish, or hope, to get some cash for while clearing out some space in her Cash for Clutter article. You can read it here on Sliver Planet.

To file a complaint or get free information on consumer issues, visit the FTC or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261 or watch a video, How to File a Complaint.

Published September 15, 2011

Florence Klein

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