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Old check-cashing scam revived with new twist

Bogus checks are drawn against very real businesses.

November 6, 2008 at 5:52AM

An old check-cashing scam has turned up again, this time using the name of America's sweepstakes king -- Publishers Clearing House -- and entangling real businesses in a troubling twist that could cost them thousands of dollars, according to the Better Business Bureau of Minnesota and North Dakota.

In the past two weeks, the consumer agency has had more than 100 calls from suspicious "prize winners," bureau Vice President Barb Grieman said. Other reports nationwide prompted Publishers Clearing House to post a warning on its website.

The new mailings are polished and convincing, and start with a familiar pattern, Grieman said: The recipients are congratulated for a big win -- in this case, a third-place, $1 million prize from the Publishers Clearing House Sweepstakes -- and they receive checks -- this one happens to be for $5,340 -- that they're advised is to cover some extraneous fees.

They're supposed to deposit the checks in their bank accounts, then quickly wire most of it to the place that handles those final details. The problem is, the wires get sent before the usual check-clearing lag tells banks that the checks are from bogus organizations.

The scammers collect the wired money and the "winners" are left covering the amount at their banks.

But in this new scam, the checks are bogus but the businesses they're written on are very real. These checks, too, are polished and convincing, Grieman said; an accompanying letter claims that the check is coming from this company because it's a sweepstakes sponsor. The checks carry the businesses' names and addresses and their correct bank account and routing numbers.

Now, if the "winners" send the wires, it's to these real businesses that the banks turn to recover their money.

This is not the first time Grieman has seen businesses used this way, but it's very rare, she said. She hasn't heard of any Minnesota business getting stuck for money this time around -- but some of the callers to her agency indicated that they were unconvinced that their letters are part of a scam and that they still planned to deposit the checks.

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Merlin Brisbin owns a sewer cleaning company in the metro Twin Cities whose name was on one of the bogus checks. Brisbin said he was lucky: The woman who got his check thought something wasn't quite right, so she called his bank, which immediately closed his account. Brisbin understands that times are hard, so people want to believe they've won a lot of money. But he's left worrying how this could happen to his small, 30-year-old company. "I have not a clue how they got all that information, and it would be nice to know," he said. "This came at us out of the blue, and it makes you feel awfully uneasy."

Anyone receiving this sweepstakes mailing is advised to contact local law enforcement, or the Better Business Bureau at 1-800-646-6222.

H.J. Cummins • 612-673-4671

about the writer

about the writer

H.J. CUMMINS, Star Tribune

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