How do I Avoid Money Order Fraud?

In order to avoid money order fraud, particularly when doing business online with people you have never met, you will need to be extremely vigilant and use your common sense when accepting a money order. The first thing to do when you receive a money order is to just check it over, make sure it is signed and filled out properly, and make sure the denominations match. Often, people committing money order fraud will attempt to alter the denomination; for instance, changing a $40.00 money order to a $4,000.00 money order. With some careful inspection, you might be able to detect this.

A money order has two denominations written, just like a bank check: one written numerically, and one written in words. Make sure these both match. In addition, one of the best ways to prevent money order fraud is to treat any money order you receive like a personal check, not cash. Deposit the money order in the bank and then wait a few days until it clears before doing anything. Only once the money order has cleared is it a good idea to complete your transaction. Be sure to notify the person sending the money order of this plan ahead of time.

Some money order sellers, such as the U.S. Postal Service, include a number of security features on the money order that you can check. You may choose to call the company or bank that issued the money order and ask to verify the amount of the money order as well. Preventing money order fraud requires some extra steps, but it is important to be sure you are not taken advantage of. Another way to prevent money order fraud is to never accept a money order in a greater amount than you asked for.

For example, some people attempting to commit money order fraud will give you a money order in a larger denomination, and will then ask you to simply cash it and refund the extra money. Of course, this can be a legitimate practice with someone you know, but in most cases it is a scam that someone will use if they have obtained a fake money order or if they have altered the amount of the money order. You are perfectly within your right not to accept a money order from someone if you suspect it is fake, or if they ask you to refund them a certain portion of the money.