Each year, roughly 500 million checks are forged. While a number of these checks are written intentionally, even people who are not knowingly writing false checks themselves may accidentally come into possession of a fraudulent check. Since this is a wide-spread problem, understanding how banks handle fraudulent check deposits will help you protect yourself from scams and legal problems.
Can You Go to Jail for Depositing a Fake Check?
Many people think check fraud is perfectly harmless since you are just depositing a piece of paper with your bank. However, the reality is that it can be quite serious. Can you go to jail for depositing a fake check? Definitely.
According to federal laws, intentionally depositing a fake check to get money that is not yours is an act of fraud. Just like any other act of fraud, you can go to jail or face fines. The exact check fraud punishment typically depends on how much money a person fraudulently obtained. Being found guilty of misdemeanor check fraud charges usually includes a fine while a felony results in jail time.
The exact amount that gets you a penalty for check fraud misdemeanor 1st offense will depend on where you live. In most states, any amount under $1,000 is a misdemeanor while any amount over the cutoff is a felony. A non-felony amount can still be upgraded to felony check fraud charges if you have repeatedly been convicted of fraud. Misdemeanor check fraud can also turn into a felony if other crimes, like assault, were involved in the check fraud.
What Happens If You Don’t Know the Check Is Fraudulent?
The majority of people depositing fake checks are not actually doing so to cheat their bank. Instead, many fake check deposits involve unknowing victims. A person may receive a fake check as a payment and deposit it without realizing it is not real. The unknowingly depositing a fake check consequences will depend on what happened both before and after you deposited the check.
First of all, the bank will take a close look at the deposit to see whether they believe you did it on purpose or not. They may fill out a police report for any deposit of a forged check, or they may do an internal investigation first. If the bank believes you submitted the check in good faith, they may avoid pressing charges or closing your account. However, if multiple forged checks are submitted over time, even unknowingly, the bank may choose to close your account.
It is also important to consider the financial consequences of depositing a fake check. The best-case scenario is that you have not used any of the associated funds yet. In these cases, the bank will just take back the funds, and neither you nor the bank will lose any money. Things get trickier if you have already started spending the funds from the check. Legally speaking, a bank can be held liable. However, this is only in cases where the bank did not properly check the check before depositing the funds into your account.
If the bank can prove that they accepted the check in good faith and used reasonable amounts of care to verify the check before depositing funds, the customer may be liable for the check. That will mean that the bank removes the fraudulent funds and proceeds from there. If your account is not overdrawn after the funds are removed, it will be as if you lost some of your savings. If your account is overdrawn, you will now owe the bank the missing funds. Typically, this will involve all sorts of fees and interest if you cannot pay it back in a timely manner.
How Can You Handle Check Fraud Charges?
If you have deposited a fraudulent check in your bank account, your next steps make a huge difference to the overall outcome. Whether or not you were aware the check is fraudulent plays a big role in the types of check fraud punishment you may encounter. It is a good idea to go ahead and consult a lawyer who can advise you on the legal side of things.
You need to be fully honest with the bank about where you got the check from. Explaining how the check came to be in your possession and why you thought it was a valid check can help your case. If possible, gather evidence like statements from witnesses or receipts that can verify your side of the story. Until things are cleared up, you should avoid spending the funds in your bank account. If you suspect a check may be fraudulent, it is a good idea to avoid spending until the bank can verify it. This can help reduce the chance of you owing the bank large amounts of money from the fraud.
How Can You Avoid Common Check Fraud Scams?
If you want to avoid check fraud punishment, it is important to be vigilant. There are all sorts of check fraud scams out there that you can fall prey to. Many of them start with a person giving you a large check to pay for something or cover a loan. Then, they tell you that you can keep some of the funds as long as you just send their “change” back to them. Often, scammers ask that you send the money through money transfer services, gift cards, or other untraceable forms of cash. Another common type of scam is awarding you a fraudulent check as a prize and then telling you that you have to pay a fee to collect your prize.
Being aware of these scams can make it a little easier to avoid them. Checks can be a safe way of receiving funds but only when sent with check printing and mailing services. Random checks from a source you do not know and trust should always be treated with some suspicion. You should always be wary of any stranger offering you a check without using reputable check printing and mailing services. Any junk mail or random emails offering you a check should be suspect. If you are worried about a check, talk to your bank before depositing it. They can help verify it and ensure that you are not on the hook for any funds.
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