A recent incident involving a Chinese woman in Southern California serves as a reminder of the age-old saying, “There’s no such thing as a free lunch.” Mrs. Xie, who resides in Southern California, fell victim to a classic “check fraud” scheme when attempting to sell her used car online, resulting in a loss of thousands of dollars and leaving her filled with regret.
Originally planning to sell her car through Carmax, Mrs. Xie felt the quoted price was too low and decided to post listings on Facebook Marketplace and Kelley Blue Book herself. After a few days, a potential buyer named “Richard” contacted her through Autotrader, expressing interest in seeing the car in person. However, after some initial contact, he disappeared, only to reappear under the name “Cesar,” claiming to have moved to Illinois and offering $11,700 to purchase the car, requesting Mrs. Xie’s help in arranging the transportation.
With a polite and courteous demeanor, “Cesar” gradually earned Mrs. Xie’s trust. Three days later, she received a $15,000 bank check from him, with an explanation that the excess amount was for shipping costs. The check initially showed as “Pending” for a day before displaying “Cleared,” leading Mrs. Xie to believe the funds were secure. As instructed, she sent a $3,229 Money Order for the supposed “shipping fee.”
However, two days later, the “buyer” abruptly backed out of the transaction, citing that his wife had chosen another car. It was then that Mrs. Xie realized something was amiss and contacted both the bank and the authorities. Law enforcement identified this as a common “check-clearing delay scam,” where scammers send fake or empty checks, briefly showing them as deposited, but later bouncing the payment after weeks, leaving the victim having sent out genuine money orders with no recourse.
Banks warn that regular checks typically take 7 to 14 days to clear and that the “Cleared” status is only temporary. Conversely, Money Orders are immediately cashable upon sending and are nearly impossible to retrieve once cashed, making them a prime target for scammers.
Detective Aily Baldwin from the Los Angeles County Sheriff’s Department Fraud and Internet Crime Investigation Bureau advises victims of fraud to immediately notify financial institutions to stop payments or close accounts and open new ones. She also suggests contacting the three major credit bureaus – Equifax, Experian, and TransUnion – to monitor credit reports and potentially freeze credit when necessary.
Baldwin also highlights that in the past, individuals were entitled to one free credit report per year, but due to the rise in fraud cases, one can now obtain a free report every six months. She recommends everyone take advantage of this to protect themselves.
When asked about the possibility of catching the fraudsters, Baldwin admits, “Most suspects may not be in California, or even within the United States, posing a significant challenge for local law enforcement.” In cases involving licensed professionals perpetrating fraud, individuals can file complaints with relevant associations and seek compensation. If unable to recover losses, consulting with an accountant regarding reporting losses on taxes is advised.
Baldwin stresses the importance of knowledge, stating that being able to identify suspicious situations, such as demands to send checks, offers to pay high shipping costs for out-of-state purchases, or requests for upfront Money Orders, is vital in staying alert. She cautions, “Be wary of any transaction that requires you to make a payment upfront. There’s no such thing as a free lunch.” Law enforcement encourages the public to participate in community anti-fraud seminars to stay informed about the latest scam tactics and avoid becoming the next victim.
Reflecting on her experience, Mrs. Xie laments, “I was too naive, thinking that once the check was cleared, it was safe. I hope my story can serve as a warning to others, so they don’t make the same mistake.”