ARCHIVED - Be warned, International Fraudsters take advantage of Spanish bank clearing times

Fraudsters take advantage of ambiguity in bank statements

Readers have contacted us to issue a warning with allegations of scams being perpetrated by fraudsters using the slowness of the cheque clearing system to extort cash from unwary expats. If the pattern of behaviour shown below has been experienced with a potential buyer of any name, cease contact immediately as this is a scam. Scammers routinely hijack identities, use a pay as you go phone which is disposed of as soon as the scam is concluded, and close bank accounts, moving on to the next identity and the next victim.

The scam being practised in this case is a common scam. Internet research shows that this scam is common on high value items, but in this case, it appears that vendors of lower value items are also being contacted.

The scammer responds to an advert of goods for sale, contacting sellers by phone or email and establishes dialogue, securing a direct email contact address, or phone dialogue so that it is impossible for any third party to monitor the correspondence and detect an irregularity.
He negotiates a sale price, via email, phone or text, then sends a bank cheque for the purchase of the item.

However, when the cheque arrives, it is for more money than the agreed sale price.

The vendor contacts him and mentions the discrepancy and is told to bank the cheque and send the difference via bank transfer once the cheque has cleared. The explanation normally given is that he has added on extra money to pay for the transport and this money needs to be given to the transporter or agent when collecting the goods. Sometimes other reasons are given, a mistake, his secretary has made an error, but the scam is always the same, and the cheque is for a higher amount

The vendor puts the cheque in the bank, and after a few days checks to see if it has cleared.

The scammer knows full well that cheques being presented in Spanish banks from overseas banks take 30 working days to clear. Some banks today told us that overseas cheques regularly take longer to clear in Spanish accounts. But the bank account statement may appear to indicate that the funds are already in the account, even though the cheque has not actually cleared.

The cheque will be presented to the bank and funds will show against the vendors account. The cheque has apparently cleared. But look carefully and the account details will show that although the money is allegedly available for use it has not, in fact, fully cleared.

The scammer knows that, and establishes a dialogue with the vendor. His agent will call to collect the goods, he confirms shipping, quibbles over details, builds trust by being in constant contact. If questioned, he will say this can´t be  a scam, as the vendor has his money in their bank account. Then as the date nears for the cheque to be cleared he applies the pressure, his shipper wants to come on x date, a couple of days before the cheque will clear, the pressure increases. By now the vendor has almost forgotten that the cheque has not actually cleared, he believes the money is in his account.

He bows to the time pressure and arranges to transfer the surplus money to the bank account given, or draw the money out as cash to pay to the agent collecting the goods.

He hands over the goods and the cash to the agent who arrives, or transfers the cash to the bank account given, expecting the goods to be collected the following day.

The shipper doesn´t arrive, the scammer phones and makes an excuse, he’ll be there on Saturday, he says, breakdown, vehicle stolen etc etc, ensuring that the victim doesn´t panic until he has the money and can move it out of the account before moving on to the next victim.
Then a couple of days later, the vendor is notified that the cheque has bounced.

In some cases, the victims have lost not only a large sum of money, but in some cases, where the scammer feels particularly confident, their goods as well.

Precautions.
It is impossible to stop scammers of this nature contacting potential victims, as victims are selected from not only internet products, but also printed media and are contacted by phone or email. ANYBODY ADVERTISING ANYTHING is vulnerable, but here in Spain, vendors are more vulnerable because of the time it takes for banks to clear cheques.

The Spanish Banking System is the biggest problem, allowing this scam to happen, because of not only the time that it takes to actually clear cheques, but the fact that funds show on bank statements and victims do not understand that the cheques have not actually cleared the system, so they have no protection.

NEVER accept a cheque for goods being sold and forwarded via an agent or shipper, always insist on cash or bank transfer.

NEVER ACCEPT A PAYMENT WHICH IS FOR A HIGHER VALUE THAN THE GOODS BEING SOLD.

IF SOMETHING LOOKS SUSPICIOUS, SEEMS TOO GOOD TO BE TRUE, OR DOESN’T FEEL RIGHT, DON´T GO AHEAD WITH IT.
WARN OTHER PEOPLE AND THE PRODUCT WHERE THE POINT OF CONTACT WAS MADE SO THAT WARNINGS CAN BE PASSED ON TO OTHER PEOPLE.