# Should we stop the phony lottery check scams by requiring banks not to float checks? **URL:** \ **Category:** Great Debates\ **Created:** [December 21, 2006, 5:15pm UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089 "2006-12-21T17:15:43Z")\ **Posts on this page:** 19\ **Page:** 1
**Author:** ![According\_to\_Pliny](https://avatars.discourse-cdn.com/v4/letter/a/8e7dd6/32.png) [@According\_to\_Pliny](https://boards.straightdope.com/u/According_to_Pliny)\ **Post date:** [December 21, 2006, 5:15pm UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/1 "2006-12-21T17:15:43Z")
We currently have many people being stung by these “Canadian lottery” and Nigerian bogus check scams. They all hinge on the patsy being sent a check to cash for someone outside the country. The check seems to clear and the patsy sends the money hoping for the promised fortune. Then he finds out the original check bounced, and now he is overdrawn or worse put in jail for trying to pass bad checks. But this scheme would go away if banks didn’t post deposit of foreign checks until they had really cleared. Banks don’t mind facilitaing in these schemes because they get protection from regulators, so that they aren’t stuck with the loss. If that rule were done away with for foreign checks, the banks would stop giving people the float and innocent people would just get a bounced deposit charge. ---
**Author:** ![DSYoungEsq](https://avatars.discourse-cdn.com/v4/letter/d/c6cbf5/32.png) [@DSYoungEsq](https://boards.straightdope.com/u/DSYoungEsq)\ **Post date:** [December 21, 2006, 5:25pm UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/2 "2006-12-21T17:25:22Z")
[QUOTE=According to Pliny] We currently have many people being stung by these “Canadian lottery” and Nigerian bogus check scams. They all hinge on the patsy being sent a check to cash for someone outside the country. The check seems to clear and the patsy sends the money hoping for the promised fortune. Then he finds out the original check bounced, and now he is overdrawn or worse put in jail for trying to pass bad checks. But this scheme would go away if banks didn’t post deposit of foreign checks until they had really cleared. Banks don’t mind facilitaing in these schemes because they get protection from regulators, so that they aren’t stuck with the loss. If that rule were done away with for foreign checks, the banks would stop giving people the float and innocent people would just get a bounced deposit charge. [/QUOTE] What banks do you know of that post ANY check balance to your account before a specified clearance time has passed? Usually, that time for foreign checks will be until the check has actually cleared. People who get scammed already have the money. They get had when the reimbursement turns out to be phony. It wouldn’t matter how long it took the check to clear and be posted, because they don’t WAIT for that to send the money. ---
**Author:** ![Steve\_MB](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/steve_mb/32/5339_2.png) [@Steve\_MB](https://boards.straightdope.com/u/Steve_MB)\ **Post date:** [December 21, 2006, 6:07pm UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/3 "2006-12-21T18:07:48Z")
[QUOTE=DSYoungEsq] What banks do you know of that post ANY check balance to your account before a specified clearance time has passed? Usually, that time for foreign checks will be until the check has actually cleared. People who get scammed already have the money. They get had when the reimbursement turns out to be phony. It wouldn’t matter how long it took the check to clear and be posted, because they don’t WAIT for that to send the money. [/QUOTE] The problem is that banks fail to clearly indicate to the depositor that the check has actually cleared, which is not the same thing as the “specified clearance time” being past. This would probably be more trouble than it’s worth in routine cases, but a requirement that a bank hold a check until it **clears** upon specific request (with the bank responsible for the loss if it fails to honor such a request and the check bounces) would at least insure that only the truly stupid get bitten (and, really, there’s no help for the fact that the truly stupid are going to get bitten one way or another). ---
**Author:** ![Triskadecamus](https://avatars.discourse-cdn.com/v4/letter/t/b19c9b/32.png) [@Triskadecamus](https://boards.straightdope.com/u/Triskadecamus)\ **Post date:** [December 21, 2006, 6:28pm UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/4 "2006-12-21T18:28:40Z")
People who conduct transactions to facilitate the violation of banking rules in other countries hardly fall into the category of “innocent victims.” The art of the short con includes finding a dishonest sucker. Doesn’t make it right, but I weep very little for the victims. Tris ---
**Author:** ![DSYoungEsq](https://avatars.discourse-cdn.com/v4/letter/d/c6cbf5/32.png) [@DSYoungEsq](https://boards.straightdope.com/u/DSYoungEsq)\ **Post date:** [December 21, 2006, 6:55pm UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/5 "2006-12-21T18:55:07Z")
I have not heard that any of the send money in return for this check scams rely upon people who wait until the check is posted to send money back. As I understand the scam, the money is usually sent right away. In any event, anyone who relies upon any of the assertions involved in such a scam deserves to lose their money. I don’t have much sympathy, nor do I see it as a problem caused by banking practices (and believe me, I have my considerable complaints about how banks post check deposits!). ---
**Author:** ![RickJay](https://avatars.discourse-cdn.com/v4/letter/r/bb73d2/32.png) [@RickJay](https://boards.straightdope.com/u/RickJay)\ **Post date:** [December 21, 2006, 7:15pm UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/6 "2006-12-21T19:15:55Z")
Honest to God, you would have to be just amazingly stupid to fall for something this transparent. I don’t understand how anyone that dumb could even have any money to steal. The government cannot eliminate stupidity, and preventing legal financial transactions to eliminate the odd scam is simply not a good exchange. They SHOULD be tracking down the con artists and hanging them. ---
**Author:** ![dropzone](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dropzone/32/7515_2.png) [@dropzone](https://boards.straightdope.com/u/dropzone)\ **Post date:** [December 21, 2006, 7:29pm UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/7 "2006-12-21T19:29:39Z")
[QUOTE=Triskadecamus] The art of the short con includes finding a dishonest sucker. [/QUOTE] > [@DSYoungEsq](#): > > In any event, anyone who relies upon any of the assertions involved in such a scam deserves to lose their money. These are especially true because the money mentioned in the letters would have been looted by the “general,” “high government official,” or “former president Charles Taylor” who needs ones help. Even if it were true anybody helping these people is abetting them in the rape of their country so I have even less sympathy for those scammed than I would for someone scammed because they thought they were helping a children’s hospital. ---
**Author:** ![Shalmanese](https://avatars.discourse-cdn.com/v4/letter/s/45deac/32.png) [@Shalmanese](https://boards.straightdope.com/u/Shalmanese)\ **Post date:** [December 23, 2006, 1:00pm UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/8 "2006-12-23T13:00:51Z")
Some versions of the advanced fee scam involve a person from Romania or a similar country trying to buy items such as laptops online and then sending a forged cheque for a larger amount than the laptop is worth and asking the mark to forward the rest of the money on to a acquaintance. The mark has done nothing dishonest and is still scammed. ---
**Author:** ![Kalhoun](https://avatars.discourse-cdn.com/v4/letter/k/3bc359/32.png) [@Kalhoun](https://boards.straightdope.com/u/Kalhoun)\ **Post date:** [December 23, 2006, 1:16pm UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/9 "2006-12-23T13:16:03Z")
[QUOTE=DSYoungEsq] What banks do you know of that post ANY check balance to your account before a specified clearance time has passed? Usually, that time for foreign checks will be until the check has actually cleared. People who get scammed already have the money. They get had when the reimbursement turns out to be phony. It wouldn’t matter how long it took the check to clear and be posted, because they don’t WAIT for that to send the money. [/QUOTE] My bank will pay on any check deposited as long as I have the funds to cover it. Always has. ---
**Author:** ![DSYoungEsq](https://avatars.discourse-cdn.com/v4/letter/d/c6cbf5/32.png) [@DSYoungEsq](https://boards.straightdope.com/u/DSYoungEsq)\ **Post date:** [December 23, 2006, 1:22pm UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/10 "2006-12-23T13:22:17Z")
[QUOTE=Kalhoun] My bank will pay on any check deposited as long as I have the funds to cover it. Always has. [/QUOTE] Precisely. It will NOT pay on the funds you deposited if they exceed the amount already in your account. In short, what I said applies: you take money you already have and send it to someone you don’t know, in return for a check you are assured will clear and reimburse you. So, if my balance is $100, and I deposit $1000, I cannot withdraw $200 after the deposit until the hold is lifted. Understand? ---
**Author:** ![FRDE](https://avatars.discourse-cdn.com/v4/letter/f/e68b1a/32.png) [@FRDE](https://boards.straightdope.com/u/FRDE)\ **Post date:** [December 23, 2006, 1:29pm UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/11 "2006-12-23T13:29:14Z")
[QUOTE=According to Pliny] We currently have many people being stung by these “Canadian lottery” and Nigerian bogus check scams. They all hinge on the patsy being sent a check to cash for someone outside the country. The check seems to clear and the patsy sends the money hoping for the promised fortune. Then he finds out the original check bounced, and now he is overdrawn or worse put in jail for trying to pass bad checks. But this scheme would go away if banks didn’t post deposit of foreign checks until they had really cleared. Banks don’t mind facilitaing in these schemes because they get protection from regulators, so that they aren’t stuck with the loss. If that rule were done away with for foreign checks, the banks would stop giving people the float and innocent people would just get a bounced deposit charge. [/QUOTE] You are mixing up a number of scams, it might be an idea to check out [www.419eater.com](http://www.419eater.com) In the UK I have deposited substantial overseas cheques and the phrase they used was ‘clear’ or ‘negotiate’ the cheque - the latter being a lot faster. ---
**Author:** ![Don26](https://avatars.discourse-cdn.com/v4/letter/d/edb3f5/32.png) [@Don26](https://boards.straightdope.com/u/Don26)\ **Post date:** [December 25, 2006, 6:02pm UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/12 "2006-12-25T18:02:26Z")
I have often thought that in this day, where an ATM card can be used virtually anywhere and have an instant effect +/- on my account balance, the fact that banks “have” to hold checks for ANY length of time is somewhat crooked. What they are really doing is earning intrest in the hold period, granted, my $30 check from Grandma ain’t much, but when added to everyone else’s… ---
**Author:** ![DSYoungEsq](https://avatars.discourse-cdn.com/v4/letter/d/c6cbf5/32.png) [@DSYoungEsq](https://boards.straightdope.com/u/DSYoungEsq)\ **Post date:** [December 25, 2006, 8:40pm UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/13 "2006-12-25T20:40:15Z")
[QUOTE=Don26] I have often thought that in this day, where an ATM card can be used virtually anywhere and have an instant effect +/- on my account balance, the fact that banks “have” to hold checks for ANY length of time is somewhat crooked. What they are really doing is earning intrest in the hold period, granted, my $30 check from Grandma ain’t much, but when added to everyone else’s… [/QUOTE] Well, it isn’t quite that bad, after all, it does take a bit of time to process the check itself and corroborate and transfer funds. But it usually doesn’t take as long as the “hold” period. Of course, what is silliest is that we even USE paper checks; we should be able to use automatic balance transfers instead (punch in the number from and the number to and instant money transfer). That would be best. 🙂 ---
**Author:** ![Don26](https://avatars.discourse-cdn.com/v4/letter/d/edb3f5/32.png) [@Don26](https://boards.straightdope.com/u/Don26)\ **Post date:** [December 26, 2006, 12:03am UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/14 "2006-12-26T00:03:19Z")
[QUOTE=DSYoungEsq] Well, it isn’t quite that bad, after all, it does take a bit of time to process the check itself and corroborate and transfer funds. But it usually doesn’t take as long as the “hold” period. Of course, what is silliest is that we even USE paper checks; we should be able to use automatic balance transfers instead (punch in the number from and the number to and instant money transfer). That would be best. 🙂 [/QUOTE] It takes seconds for the information to swap back and forth with any location on the globe, thanks to HiSpeed internet. With the readers the banks have now, they don’t even have to punch in numbers… ---
**Author:** ![DSYoungEsq](https://avatars.discourse-cdn.com/v4/letter/d/c6cbf5/32.png) [@DSYoungEsq](https://boards.straightdope.com/u/DSYoungEsq)\ **Post date:** [December 26, 2006, 12:29am UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/15 "2006-12-26T00:29:05Z")
[QUOTE=Don26] It takes seconds for the information to swap back and forth with any location on the globe, thanks to HiSpeed internet. With the readers the banks have now, they don’t even have to punch in numbers… [/QUOTE] You make a poor assumption on how the process works. You assume Bank A (where the check is deposited) talks to Bank B (where the check is drawn). This doesn’t happen. Instead, the whole process goes through a central clearing center. Now, yes, that sort of data swap isn’t that hard to do in much more time, but the process is usually done during hours that the banks are closed, so that daily balances can be calculated more easily. Can it be done differently? Yes, but frankly, if they are going to set up a direct system, they might as well go ahead and set up a system that eschews the need for paper checks at all. 🙂 ---
**Author:** ![Spectre\_of\_Pithecanthropus](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/spectre_of_pithecanthropus/32/12343_2.png) [@Spectre\_of\_Pithecanthropus](https://boards.straightdope.com/u/Spectre_of_Pithecanthropus)\ **Post date:** [December 27, 2006, 7:11pm UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/16 "2006-12-27T19:11:17Z")
[QUOTE=DSYoungEsq] Precisely. It will NOT pay on the funds you deposited if they exceed the amount already in your account. In short, what I said applies: you take money you already have and send it to someone you don’t know, in return for a check you are assured will clear and reimburse you. So, if my balance is $100, and I deposit $1000, I cannot withdraw $200 after the deposit until the hold is lifted. Understand? [/QUOTE] Obviously policies vary, and it isn’t always true that the bank won’t let you withdraw or spend money on a pending deposit. For checks between $1K up to at least $5K\*, and possibly more, my bank clears $500 immediately when they are deposited through the ATM. That money can be immediately withdrawn or spent, via the bank card, even if the prior balance was zero, with the understanding that if the check turns out to be bad I would be liable for all charges and as many overdraft fees as are applicable. \*For smaller deposits, $100 or the deposit amount is immediately cleared. ---
**Author:** ![DSYoungEsq](https://avatars.discourse-cdn.com/v4/letter/d/c6cbf5/32.png) [@DSYoungEsq](https://boards.straightdope.com/u/DSYoungEsq)\ **Post date:** [December 28, 2006, 12:40am UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/17 "2006-12-28T00:40:09Z")
[QUOTE=Spectre of Pithecanthropus] Obviously policies vary, and it isn’t always true that the bank won’t let you withdraw or spend money on a pending deposit. For checks between $1K up to at least $5K\*, and possibly more, my bank clears $500 immediately when they are deposited through the ATM. That money can be immediately withdrawn or spent, via the bank card, even if the prior balance was zero, with the understanding that if the check turns out to be bad I would be liable for all charges and as many overdraft fees as are applicable. \*For smaller deposits, $100 or the deposit amount is immediately cleared. [/QUOTE] Location and name of bank, please. 🙂 ---
**Author:** ![Arnold\_Winkelried](https://avatars.discourse-cdn.com/v4/letter/a/3d9bf3/32.png) [@Arnold\_Winkelried](https://boards.straightdope.com/u/Arnold_Winkelried)\ **Post date:** [December 29, 2006, 7:10am UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/18 "2006-12-29T07:10:57Z")
I’m not an expert on the subject, but I will quote this Washington Post article: [http://www.washingtonpost.com/wp-dyn/content/article/2006/05/31/AR2006053102004\_pf.html](http://www.washingtonpost.com/wp-dyn/content/article/2006/05/31/AR2006053102004_pf.html) > [@](#): > > Federal rules require banks to release funds from a consumer’s deposit quickly, usually within one to five business days, depending on the kind of check. However, it can take weeks before a bank discovers a check is fraudulent. > > So when a teller says “the check has cleared,” the teller is “usually thinking in terms of bank rules, that the hold time is over, and the consumer now has access to the funds,” said Susan Grant, director of the National Fraud Information Center. > > But the average consumer thinks that phrase means “the check is not fraudulent,” Grant added. and > [@](#): > > Gaston received a $4,500 cashier’s check on Saturday, Feb. 26, and immediately deposited it in her Bank of America account. The teller told her it would take three days for the check to clear. On Wednesday, Gaston reviewed her account online and saw the funds were in her account. “I assumed, since it was a cashier’s check, that Bank of America had actually gotten money from the other bank and put it into my account,” she said. … > Bank officials told her there was nothing the bank could do and warned her that she would have to repay the $3,900 when the counterfeit cashier’s check was finally returned to the bank. > It took another month before that happened. According to the 419 scam articles I have read, it seems to me that the only safe recourse is to wait more than a month before touching any money from a check you have deposited. Or am I not understanding this right? ---
**Author:** ![Arnold\_Winkelried](https://avatars.discourse-cdn.com/v4/letter/a/3d9bf3/32.png) [@Arnold\_Winkelried](https://boards.straightdope.com/u/Arnold_Winkelried)\ **Post date:** [December 29, 2006, 7:15am UTC](https://boards.straightdope.com/t/should-we-stop-the-phony-lottery-check-scams-by-requiring-banks-not-to-float-checks/385089/19 "2006-12-29T07:15:08Z")
Of course I understand that the primary rules should be: if A asks me to cash a check and then write another check to B, then I tell A to send the money to B himself; if A asks me to cash a check and send him back the difference, I tell A to write me a new check with the exact amount. However, if I accept a check in payment, it looks like depositing it in my bank account is risky, because it can take more than a month before I find out that the check is fraudulent.