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Students should beware scams
Many students may believe they are safe from con artists and other scams, but a new threat is affecting people all across the nation, as well as locally. Nigeria has a thriving internet-based scam operation, and their targets are set on people selling items online.
Scammers pose as potential buyers for big item sales, such as cars and motorcycles, and through email contact, arrange purchasing the item by mailing a cashier's check to the owner. These buyers, however, write the check for an amount over the purchase price, typically around $3000- $5000 over, claiming it's a necessity to arrange for the transportation and shipping of the item, as the con artists pretend they are overseas dealers, typically located in the United Kingdom or in Africa. After the check clears, they then request that the remaining amount be wired to an associate in Nigeria who will then deal with the shipping arrangements.
Unfortunately, through a little-known loophole in the U.S. banking system, checks can be cleared through a bank without being legitimate. Most checks take a significantly longer time to clear, anywhere from two weeks up to three years. Usually the banks make the funds available to their customers immediately, as not to inconvenience their customers. People then wire the money to the con artists before the bank realizes the check is counterfeit and revokes the deposit, leaving most customers with a negative balance and frozen accounts. Unfortunately, the depositors are responsible for the check bouncing and not the bank, so victims are forced to pay the bank back for funds lost.
This is what happened to Ryan Kuss, an SCSU student. Trying to sell his motorbike online, he made arrangements with overseas traders and was ultimately conned.
"I asked the teller when I was depositing the check when I would know that it's 'good,' and she told me to come back next week to be on the safe side," said Kuss. "I came back next week and asked another teller if the check had cleared. She said that it had and that the funds were 'good to go.' I would have never withdrawn the money had I not been told by the (two) clerks that I was all clear!"
Kuss had waited a week before wiring the money over, but the bank discovered that the check was counterfeit a few days later, and is holding Kuss responsible for the money loss. He is fighting back and is currently in litigation with the bank to pay for his loss.
"This whole situation was caused by the bank and an employee giving me the wrong information," said Kuss. "I should not be held liable, as the employee misinformed and misled me."
Kuss is not alone. Scam Victims United is an online support group and non-profit organization created by Jeff and Shawn Mosch, who were also victims of the same con and lost $7200 when trying to sell a car online. They too are fighting the bank system, and their website's aim is prevention, providing tips and information for a multitude of scams, including identity theft, ATM scams and the popular work-at-home scam. They also provide a forum for victims to exchange stories in attempts to provide comfort and options for getting their money back.
"I know the whole deal sounded weird from the get go, but we said if the check clears, what the heck, who cares how this guy wants to pay for it," said Shawn Mosch. "But (the bank) told me the check would clear in 24 hours, and I trusted that they knew what they were talking about. Isn't that their job, to inform customers and help insure our financial safety?"
Although each bank has different lengths for when a check clears, a cashier's check could bounce well after that period, unbeknownst to most customers. Victims are advised to 'make a nuisance' by contacting local media as well as litigating with the banks, as some victims have won their case and is requiring the banks to pay for the financial loss.
"I asked to know not just when the funds would show up in our account, but I need to know when we can be sure that it is a good check, that it has cleared, and that it is real money that we can touch and use," said Mosch. "The teller laughed and told us it would be good in 24 hours. Why are we responsible because their employee gave me the incorrect information?"
For more information on your rights, visit www.scamvictimsunited.com and the Public Citizen at www.citizen.org.
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