Business Law Course You decide to sell your tablet on-line for $500. A buyer sen
ID: 362292 • Letter: B
Question
Business Law Course
You decide to sell your tablet on-line for $500. A buyer sends you a certified check for $600. The buyer instructs you to “just go ahead” and use the check to cover shipping and wire (via Western Union) any difference along with the shipment. You deposit the check and your account reflects the deposit. 10 points
A. Is it safe to send the tablet and wire the balance? Explain
B. What can you do to protect yourself from being scammed? Explain
See: https://www.thebalance.com/cashier-s-check-fraud-315795 (Links to an external site.)
Answer need to use legal terms (:
Explanation / Answer
A. It is not safe to send the tablet and wire the balance. The rationale is that the cashier’s check received from an unknown party might be fraudulent. It can be fake or forged. However, unless the bank which has drawn the check actually honors it you can lose your money. Your bank feels that the cashier’s check is real and deposits the funds in your account. Next, the bank sends it for clearing. When the check reaches the bank from which it has been “issued”, the issuing bank rejects the cashier’s check and the check is returned to your bank. When the check returns, if there is enough balance in your account the bank reverses the deposit. In case you have withdrawn the money, you will be held liable by the bank and you will have to return the money to your bank. You should neither send the tablet nor should you send the wire transfer. If you send the tablet and the wire transfer, your loss will be equal to $600.
B. There are several actions you can take to protect yourself from being scammed. When you receive the check from an unknown source, you should examine the check carefully. There can be some errors in spelling, printing glitches, or unnecessary marks. Further, you should never accept a check for more than you have asked for. If you agree to receive a cashier’s check from a local buyer it is advisable to go to the bank with the buyer to the teller who issues the cashier’s check. Be careful that the check is not switched. The funds deposited in the bank account should be left for a few days before the goods are delivered. If there is a need for outstation payments, these should be received through wire transfer or other reliable modes of payment. If a local buyer makes a payment with a cashier’s check, refuse it and ask for cash payment. Cash is far safer than a cashier’s check.
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