Fraud Alert: Consumer Protection Urges Businesses to Be Wary of Money Order Fraud
(HARTFORD) – The Department of Consumer Protection (DCP) is warning businesses about check and money order fraud. While this is not a new type of scam – bad actors are often more likely to take advantage of businesses in times like these, when they are already facing hardship.
DCP recently received a complaint from a business about money order fraud that works like this:
- A business that provides services, and requires a deposit, receives an inquiry from a potential customer.
- That customer agrees to use their services, signs a contract, and sends a check or money order for their deposit, but the check is for two or three times the amount that was agreed upon.
- The customer then asks the business owner to return the overpayment amount. Remember, it can take a couple of days for a check to clear the bank.
- After the business owner has paid the customer back, they find that the check has bounced, or the money order is fraudulent – and that business has lost money.
Here’s what you can do to protect yourself:
- If a check or money order looks fraudulent, or you receive it under suspect circumstances, call the issuing institution to verify its legitimacy.
- If you ever receive an overpayment for services, and a customer requests a refund, be suspicious, and always wait until their check clears to issue a refund.
- Be wary of doing business with someone who commits immediately, without asking questions.
“Small businesses are unfortunately often the target of scam artists – especially when they’re already facing challenges and may be more likely to act quickly,” said Consumer Protection Commissioner Michelle H. Seagull, “We want to remind businesses to be diligent, and vet their customers carefully, especially when someone seems almost too eager to do business. If anyone feels they have fallen victim to a scam – we want to hear from them.”
“Small businesses are facing unprecedented challenges right now due to COVID-19, and scammers are looking to exploit those hardship for personal gain. If you receive an overpayment via check or money order, wait until the check clears to process the refund,” said Attorney General Tong.
“Many people don’t realize that money orders and cashier’s checks can be fraudulent too,” said BBB Connecticut Spokesperson Luke Frey, “Small business owners need to be especially cautious and should never cash a check from a customer who is knowingly overpaying and requesting to be reimbursed.”
Anyone who feels they have been targeted by fraud – whether or not they have fallen victim – is encouraged to file a complaint with DCP by visiting www.ct.gov/DCP/complaint.
Department of Consumer Protection
Lora Rae Anderson
(860) 247-8711 (cell)
Office of the Attorney General
Better Business Bureau Serving Connecticut
(860) 384-5875 (cell)