Overpayment fraud is becoming increasingly common, often leaving victims deep in debt. Typically, it starts off looking harmless enough: someone sends you a check for more than you expected, asks you to forward the extra amount, and then—if the check bounces—you’re left to cover the difference. Below are five prevalent types of overpayment scams you should keep an eye out for.
1. Dog Sitting Overpayment Scam
A recent example comes from Bob in Harrison, Ohio, who fell for a scammer posing as a pet owner. It began with an offer of $250 for taking care of a dog, but Bob received a check for $4,358 instead. The scammer then instructed him to send $4,000 to an “appliance retailer.” It’s strange, right? Why would a pet owner involve an appliance retailer? Scammers often use third-party entities to make their stories seem more legitimate and urgent. If they simply asked for a refund, it would raise suspicions. Ultimately, that “retailer” is just another part of the scam. The check may look convincing, but it’s fake, and once bounced, you’ll be responsible for the total amount.
Tip: If someone asks you to send money to a third party unrelated to your initial transaction, consider it a scam. Always keep records of checks and envelopes, and report the incident to the FTC and your state attorney general.
2. Online Marketplace Scam
If you’re selling items online—like furniture or electronics—be aware. Some buyers mistakenly send too much money and then request a refund for the difference through services like Zelle or Venmo. When the checks bounce, you lose both your product and the refund.
Tip: Stick to confirmed payment methods. If a buyer asks for an immediate refund, it’s best to walk away.
3. Mystery Shopper Scam
You may encounter offers via email or letter to work as a mystery shopper. Typically, you would be sent a check to buy gift cards and then asked to return the card numbers as proof of purchase. Once the bank reverses the fake checks, you’re left paying for those gift cards.
Tip: Real companies won’t pay you upfront with extra funds or ask for gift card numbers via email.
4. Rental Deposit Scam
This scam targets prospective tenants with checks that exceed the deposit or rent. Scammers then claim it was a mistake and request a refund for the overage. Later, the check bounces, leaving you in a tight spot.
Tip: Always accept payments through secure online portals or verified funds.
5. Work from Home Fraud
Job seekers might be approached with offers that include receiving a large check to buy office equipment, with the stipulation to transfer additional funds to the vendor. These checks are counterfeit, and the vendors are also part of the scam.
Tip: A legitimate employer will provide equipment directly or cover confirmed costs, not request extra funds due to overpayment.
How to Protect Yourself from Overpayment Fraud
From fake dog-sitting gigs to marketplace scams, these scams follow a similar pattern: someone pays you too much and pressures you to send the extra money back. But here’s the thing: that “extra” never existed, and when the check bounces, you’re stuck with the bill. Fortunately, there are steps you can take to shield yourself.
Pause Before Acting
All the scams mentioned start with seemingly innocent overpayments. If you receive more than you should, be cautious. Don’t engage with third parties or send any money. Keep the checks and envelopes as proof and report them.
Check Your Funds at the Bank
Scammers count on you to trust what you see in your bank account. In Bob’s case, his check looked real; however, available funds are different from cleared funds. Always confirm with your bank that funds are verified before using them.
Don’t Rush
Urgency is a powerful tactic used by con artists. They might pressure you to resolve “mistakes” quickly. Don’t let them rush you; take your time to double-check everything.
Use Secure Payment Systems
Scammers favor paper checks because they’re easy to forge. Use a secure, trackable payment method instead, whether for rentals, freelance work, or selling second-hand items.
Keep Records of Communications
If you receive a suspicious check, save everything—emails, texts, and envelopes. In Bob’s case, the stored information turned out to be helpful evidence for law enforcement.
Consider Data Removal Services
Scammers often exploit personal information they find online. Using personal data removal services can help reduce exposure and make you harder to target. Although such services aren’t always inexpensive, they can effectively manage your online footprint.
Enable Fraud Alerts with Banks
Many banks allow you to set up alerts for large deposits or unusual transactions, enabling you to catch suspicious activities early.
Report Scams
Just as Bob stopped communicating with the scammer, reporting fraud can help protect others. File a report with the FTC and inform your local authorities.
Key Takeaways
Overpayment fraud relies on trust and urgency. It can arise through various means, including online sales, job offers, and rental agreements. Being aware of the warning signs can help you stop these scams before they impact your wallet. Always be wary if asked to deposit more than expected or send any extras. If something feels off, it probably is.
