Should you accept a money order as payment for goods sold online? How do you know if it’s real? Identifying counterfeit money orders is easy if you know what to look for.
Online fraud artists have been using counterfeit and worthless checks for years. However, in recent years, there’s been an uptick in the use of counterfeiting U.S. Postal Service money orders.
The quality of what these con artists are producing is very good and ordinary consumers can easily be fooled. This scam is also prevalent on online auction sites like eBay, bulletin boards and email solicitations.
According to the F.B.I. and the U.S. Postal Inspection Service, in the six month period from October 2004 through March 2005, forgers in other countries – such as Nigeria, Ghana and Eastern Europe – have renewed their interest in the United States postal money order.
In just three months, October 2004 through December 2004, more than 3,700 fake U.S. Postal money orders were intercepted. This number exceeded the total number of captured counterfeit U.S. Postal money orders for the previous 12 months.
Counterfeit Money Order Arrests are on the Rise Worldwide
During the same six month time period, October 2004 through March 2005, at least 160 arrests were made in the U.S. The people arrested were suspected of deliberately receiving counterfeit U.S. Postal money orders and/or trying to cash them.
Unfortunately if you’ve been a victim to any of these individuals your money and/or you product is long gone.
Most of the time the counterfeiters are not the ones trying to use the U.S. Postal money orders. Instead they’ve focused their efforts on contacting would be victims using email or via an online chat room. They try to trick victims into taking the fake U.S. Postal Service money orders in exchange for items their selling on places like eBay or Craigslist.
Sometimes they even get people to cash the money orders in return for a fee that they’ve promised them. Bogus financial instruments have been used over and over again in many different flavors of the same basic Internet scheme.
According to the United States Postal Service they’re not able to approximate the dollar value of the counterfeit postal money orders they’ve intercepted. Some experts guess the total amount could run into the millions of dollars.
This increase in activity is worthy of note due to the security measures taken to help ensure U.S. Postal money orders are hard to fake. Dissimilar to private business checks or even other money orders created by banks, the U.S. Postal money order has watermarks, security threads and a rainbow of inked patterns and tones.
Small Internet Retailers and the Public are Favorite Targets for Money Order Counterfeiters
The lack of consumer common sense has led to counterfeit U.S. Postal money orders being used to purchase goods/services from small Internet retailers, classified advertisers or others lured into an Internet con scheme, from sellers of antiques to exotic and classic automobiles. They’ve permeated every corner of commerce.
The U.S. Postal Service inspectors say they’ve been working with global delivery companies, like Federal Express and UPS, to catch packages containing phony money orders as they enter the United States. They also communicate to financial institutions, asking them to “keep an eye out” and continue to be vigilant.
You can find tips for identifying counterfeit postal money orders online, , at https://www.usps.com/postalinspectors/
How to tell the difference between genuine USPS postal money orders and fake ones
U.S. Postal Service Money Orders have security features that distinguish them from other financial instruments. Learning to recognize them will protect you from being victimized by the scheme. Postal Money Orders have special inks, watermarks, and security threads.
The two most prominent security features can be viewed by holding the money order in front of a light source. Look for these features:
- A watermark of Benjamin Franklin, the oldest and one of the most famous signers of the Declaration of Independence and the U.S. Constitution, is visible on both the front and reverse side of the money order when held to the light.
- A dark security thread running (top to bottom) to the right of the Franklin watermark, with the tiny letters “USPS” facing backward and forward.
The Postal Service issues domestic and international money orders. Domestic Postal Money Orders cannot exceed a value of $1,000. They are distinguished by their green, yellow, and blue colors. Most counterfeit Postal Money Orders are domestic, with a face value of $750 to $950.
International Postal Money Orders are printed in pink, yellow, and gold and cannot exceed a value of $700. There has been an increase in counterfeit international money orders printed with values of $500 to $700.
How Counterfeit Money Order Scams Work
In a typical counterfeit money order con, the person selling an item is sent counterfeit postal money orders that together amount for more than the cost of the item being paid for. The buyer then asks the seller to keep the cost of the purchase and ship back the difference between what was sent and what was owed, in cash, along with the merchandise.
This is also known as a Nigerian Scam because many of these types of scams have originated in Nigeria or other African nations.
These scams have become very sophisticated recently and there are all kinds of variations. If you want to ensure you aren’t accepting a counterfeit money order, never accept one from a stranger unless you have some way of verifying its authenticity.
You can also protect yourself by being smart and watching out for warning signs such as offers to pay more than something is worth. Paying attention to “red flags” instead of ignoring them can save you a lot of grief…and money.