Cashier’s checks are a time-tested way for private parties to exchange payment. These official bank checks are guaranteed by financial institutions, right? Yes and no. Sophisticated printing technologies make it easier than ever for scammers to create convincing fakes that even bank tellers might miss.
Learn how to spot fake cashier’s checks, dodge cashier’s check scams, and protect yourself during a private-party car sale. Then, discover a scam-proof way to get paid that streamlines the car sales process.
A cashier’s check is issued and backed by a bank instead of an individual. When someone buys a cashier’s check, the bank removes the money from the payer’s account and writes a check backed by its own funds. Unlike personal checks, cashier’s checks can’t bounce. Direct bank backing is why many people accept cashier’s checks for major transactions.
Despite their reputation for security, cashier’s checks can be forged. Advanced printing technology lets scammers create counterfeits that look real. Many include security threads, color-shifting ink, and other sophisticated features.
Even worse, banks often make funds available before they verify if a check is legitimate. US banks must legally open up $5,525 of the check by the next business day after the check is cashed. Depending on the size of the check, the depositor’s account history, and suspicion of fraud, they may freeze the remaining amount for up to a week while they investigate. This lag time causes the depositor to believe the check has been verified. In a private-party transaction, the supposed buyer uses this lag time to get the seller’s item and disappears before the fraud is discovered.
Car sales are particularly attractive to cashier’s check scammers because:
A seller might hand over their car’s title and keys, thinking they’ve received valid payment, only to learn days later that the check was fake. By then, the “buyer” and the car are long gone.
The best way to avoid a fake cashier’s check is to verify it before continuing the sale. Follow these steps to avoid accepting a fraudulent check:
Most cashier’s check scams require you to skip verification. Don’t fall for it. Walk away from any buyer who pressures you to finish the sale before you verify the check.
In-person verification or verification using the issuing bank’s confirmed phone number is better than trying to spot a fake check yourself. Many counterfeit checks look convincing but will fail verification. That said, you should still understand the common tells of a fake cashier’s check so you can use your judgment to navigate the situation. These are some of the common signs you’re dealing with a fake check and a scammer.
When examining a cashier’s check, look for these warning signs:
Genuine cashier’s checks include multiple security elements that are hard to replicate:
Sometimes the buyer’s behavior can tip you off to fraud. Exercise suspicion if the buyer:
Just because a check has security features doesn’t mean it’s real. Today’s counterfeit checks often include sophisticated security elements that can fool even experienced bank tellers. Always verify—preferably in person.
Cashier’s check scams target car buyers. Here’s how scammers use cashier’s checks to steal your car, money, or both.
The “buyer” sends you a cashier’s check for more than your asking price. They’ll claim it was a mistake and ask you to wire back the difference. After you send the money, you’ll discover their check was fake—and you’re out both the wire transfer amount and possibly your car.
Someone claims to be buying your car for an overseas client. They send a fraudulent cashier’s check and include extra to pay a “shipping company” (actually the scammer). Both the check and shipping company are fake, and you’ll lose any money you send.
A buyer arrives with a cashier’s check and pressures you to complete the deal immediately. They’ll have excuses about why you can’t verify the check—they’re leaving town, need the car urgently, or their bank is closed. They want the car before their fake check is discovered.
The scammer shows you a real cashier’s check during your meeting, but when it’s time to make the deal, they hand you a fake one that looks identical. If you don’t verify the check in your possession before finishing the sale, you will lose your car.
If your bank notifies you that you cashed a fake check, you need to act fast. Contact your bank and explain the situation. Even though the bank initially made the funds available, you’re legally responsible for any money you spent from a fraudulent cashier’s check. The bank can—and will—deduct that amount from your account or require you to repay it.
Your next step is filing a police report. While recovering your money might be difficult, a police report creates an official record of the fraud. Provide all information about the buyer, including phone numbers, email addresses, and a physical description.
Report the fraud to the consumer protection agency in your state and submit a complaint to the Federal Trade Commission (FTC). If you sent money via wire transfer or another payment service as part of the scam, report it to that service immediately. You might not get your money back, but reporting helps authorities track fraud patterns and catch scammers.
If you handed over your car, provide the police with:
Many victims of check fraud never recover their losses. That’s why prevention is best. When selling a car, choose a payment method that protects both parties.
When selling your car, you shouldn’t have to worry about fake check scams or losing your car to fraud. DealNow gives you identity verification and instant payment so you don’t have to. Before you hand over the keys, you’ll receive real money in your account.
Besides verifying the buyer’s ID to keep scammers away, our platform is loaded with safety and convenience features:
After you’ve used DealNow to sell your car, you’ll understand just how safe a private-party transaction can be.
A fraudulent cashier’s check never actually “clears.” Banks make the funds available to you before they verify if the check is real. This creates a dangerous window where you think you’ve been paid because you can access the money
The counterfeit check will eventually be discovered. When it is, the bank will take back the funds—even if you’ve already spent them or handed over your car. This gap between fund availability and verification is exactly what scammers count on.
A fraudulent cashier’s check doesn’t bounce (like a legitimate personal check from an unfunded account). It can take up to 6 weeks for the bank to discover the fraud, even though they often make the funds available within two business days.
Financial institutions initially credit your account before they fully verify the check. When they discover it’s fake, they’ll remove the funds—even if you’ve already spent them.
If you’re a victim of check fraud, file a report with your local police and the Internet Crime Complaint Center. Contact the Federal Bureau of Investigation and your state’s consumer protection agency. If you found the buyer through an online marketplace, report them to that platform. Consider visiting a legal aid office if you need help understanding your rights.
The safest payment methods offer instant verification and can’t be faked. DealNow provides secure, instant transfers with identity verification. This eliminates counterfeit payments while protecting both parties in the transaction.
Both are bank-backed checks, but they work differently. A certified check is drawn against your personal account with the bank certifying the funds are available and your signature is genuine. A cashier’s check is drawn from the bank’s funds, offering enhanced security since the bank guarantees payment.
Banks will verify their own cashier’s checks during banking hours. Most banks won’t verify other institutions’ checks. The safest way to verify a cashier’s check is to meet at the issuing bank during business hours.
Unlike money order companies that cap transactions at $1,000, most banks don’t set an upper limit on cashier’s checks. However, large sums of money may trigger additional security measures or require approval from a bank customer service representative. Some banks also charge higher fees for larger amounts.
Each cashier’s check has a unique tracking number that allows banks to trace the entire transaction. This process isn’t instant; it can take several business days and usually requires filing formal paperwork with the financial institution. If a check is lost or stolen, the tracking process becomes more time-consuming and may involve additional fees for cancellation and re-issuance.
DealNow is the easiest way to close your own vehicle deal, anytime. It’s the safe and simple way to avoid fraud, sign documents, and instantly transact, all in one app.
