(THE BELOW EXAMPLE LOOKS LIKE THE SCAM THAT WE ARE INVOLVED WITH)
In another case an elderly lady received both a letter and a check from Canada saying that she had won the lottery. The check was made out to her and displayed the name of a bank in Canada along with the bank's phone number.
The letter gave the elderly recipient instructions to cash the check and then immediately mail a cashiers check to the address stated in the letter for the required payment of taxes on her winnings.
The bank diligently called the phone number that was on the check to verify funds, but little did they know (until it was too late), that the phone was, in fact, a cell phone and the bank was a fictitious entity. The person on the cell phone officiously verified funds available and so the bank cashed the check for the "winner" for a very large amount of money.
The lady then took some of that money and dutifully bought a cashiers check to pay the taxes on her winnings and mailed the check to the address on the envelope, which was probably a post office box. By the time the check that represented her lottery winnings bounced, her check to pay the taxes had been cashed by the criminals.
With ready access to her account, the bank managed to get back most of the money that the lady falsely thought were her winnings and then held her accountable for the money she had sent off to pay her taxes, which was a lot of money.
The cons suckered her in because she had actually received money in hand. Once she thought she had her winnings in her account, she gladly paid taxes on it. Ignorance of banking laws is no excuse apparently.
In an FDIC alert about the Canadian Lottery scam, a Canadian Mounted Police report indicates that they learned that U.S. banks "can freeze funds for a period of up to 14 days in order to confirm funds are secured" under an agreement between Canada and the US for the timely return of checks, although no reference of this can be found and a Canadian attorney consulted on the matter did not believe any such agreement exists.
Some banks have therefore established a $1,000 threshold for consumers and $5,000 for businesses based upon what they felt was an acceptable risk level for banks of their size.
Two tiers were created based on the level of recapture risk - the likelihood of being able to recapture funds from the customer should a deposited Canadian check be returned later for reasons of fraud.
However, even for deposits below these thresholds, they plan to place holds on the funds for the average three weeks it takes for a Canadian NSF check to be returned.
High collection fees imposed upon the customers by the banks correspondent processor is apparently one reason not all Canadian checks are sent as collection items.
(AND THEREIN LIES THE FRAWD. THEY SENT MY ROOMATE A CASHIER'S CHECK FOR $3,800.00 FOR HIS DIRECT DESPOSIT IN BANK OF AMERICA. THEY REQUESTED THAT THEY HE SEND BACK TO THEM $2,500.00. ALL THE WHILE BANK OF AMERICA HAS CALLED UP THE FICTICIOUS BANKING INSTITUTE TO VERIFY FUNDS, AND THE PERSON ON THE OTHER END REPRESENTING SUCH BANK, IS A SHILL WHO VERIFIES IT. BUT, IN THIS CASE HIS BANK (BANK AMERICA) HAS BEEN SWINDLED BECAUSE THEY COVERED THE CHECK, THEN HAVE RECOURSE TO SUE MY ROOMATE FOR BEING CAUGHT UP IN THE SCAM. IGNORANCE OF BANK LAWS IS NO EXCUSE).
THIS IS EXACTLY THE M.O. THAT IS BEING USED HERE. WE WERE ORIGINALLY CONVINCED THAT IF THE CHECK CLEARED WE WERE IN THE MONEY. NOT SO, IT APPEARS--FALSE BANK--FALSE VERIFICATION.
DOES THIS SOUND LIKE I HIT THE NAIL ON THE HEAD?
Triceratops
