The Police are warning the public of a new type of fraud being dubbed 'criminal cashback'. The new fraud is aimed at anyone who advertises something for sale, be it over the internet, in the local paper, in the specialist press or in a shop window. Average losses are between £3000 and £5000.

Criminals have targetted members using the classified ads on this site earlier this year but thanks to users promptly notifying us of their suspicions we were able to issue a warning to all advertisers and inform the police.

The targeted victim will be contacted by the fraudster posing as a buyer. Whatever the price of the item for sale, the 'buyer' (or their agent/associate) will send a UK cheque or bankers draft for significantly more than the asking price. The 'buyer' will then enter into an agreement with the vendor that this overpayment will be returned to them via 'money transfer' or sent to a third party or shipping agent once it 'clears' in the vendors account.
The crux of the scam is that the victim does not believe there is any risk in doing this, due to public misunderstanding of the banks 'clearing' cycle.

Once a cheque/bankers draft has 'cleared' it will show in a bank account as a credit and funds to the value of it can be drawn out. However, if the cheque/bankers draft is fraudulent or stolen its value will be taken back out of the account to which it was paid when this fact is discovered. This can be up to weeks later.
In effect the victim is being duped into sending their own cash to the fraudster by irreversible 'money transfer' in response to their worthless piece of paper. The victim and not the bank is liable for this loss.

The Metropolitan Police has worked closely with the British Banking Association and APACS to try and highlight this fraudulent crime in an attempt to raise public awareness and by doing so prevent further offences and disrupt the criminal gangs involved.

DCI Stuart Dark, from the Met's Economic and Specialist Crime Unit, said, " The advice to anyone who is selling something is do not accept a cheque or bankers draft for any amount over your asking price. You should also be suspicious if the buyer appears reluctant to meet up to view an item for sale where this would normally be the usual procedure (i.e. a car, scooter). If you have already been overpaid for an item, do not transfer any cash from your own account to anyone connected with the deal by money transfer - even if their funds appear 'cleared'. Also, don't be afraid to ask questions of your customer, don't be afraid to work at your own pace (fraudsters often hurry you into making a mistake), and don't be afraid to seek advice or to terminate a sale."

November 29, 2004