Fake check scam
A fake check scam sends you a bad check, then asks you to send some of the money back before the bank finds out the check is fake.
Also called: counterfeit check scam, overpayment scam, fake settlement check scam
A fake check scam sends you a bad check, then asks you to send some of the money back before the bank finds out the check is fake.
What it means
In a fake check scam, a stranger sends you a check, often for more than you are owed, and asks you to send part of it to them or to someone else. The story varies. It can be an overpayment, a prize, taxes or fees on a payout, or supplies for a new job. The check looks real, and the money may even show up in your account.
That is the trap. Banks have to release deposited money quickly, so funds can show up as available long before the bank spots the forgery, which the FTC says can take weeks. By then the scammer has the money you sent, and you owe the bank.
Settlement scams use the same trick. A "settlement" check arrives with a letter saying you must pay a fee, a tax or a refund of the overpayment before you can keep it. A real settlement payment does not require you to send money back.
What it means for you
Do not use money from a check you were not expecting. If you never filed a claim in a settlement, a check from it is a red flag. If you did file, confirm the payment through the official settlement website, using contact details you find yourself, before you deposit or spend it. Never send gift cards, wire transfers, money orders or crypto to anyone who asks. If you already deposited the check, tell your bank it may be fake and report the scam at ReportFraud.ftc.gov.
Example
Say you get a $3,000 check from a "settlement fund" with a letter telling you to deposit it and wire $1,200 back to cover taxes. Your bank shows the money as available in a couple of days, so you send the wire. Two weeks later the check bounces. The $1,200 is gone, and you owe the bank the full amount.
FAQ
Banks must release deposited funds quickly by law, so the money can appear in your account before anyone finds the forgery. The FTC says that can take weeks, and you are left repaying the bank.
Confirm that you filed a claim, then contact the settlement administrator through the website you find on your own, not the phone number on the letter. A real settlement check never requires you to send money back.
Related terms
Updated Oct 18, 2026. Plain-English definitions for general information — not legal or tax advice.