Cashier’s Check Fraud in Used Car Sales

When you sell your car, don’t fall prey to cashier’s check fraud.

Fraudsters exploit the legitimacy of cashier’s checks to scam sellers. But there’s a safer and easier way of receiving payments.

PrivateAuto's integrated payment system enables direct and secure transactions. With user verification, instant payments via PrivateAuto Pay, and electronic docu-signing, PrivateAuto makes private car sales secure and easy.

A cashier’s check is a check issued by a bank, rather than from a buyer's personal account. The funds are guaranteed by the bank, meaning the money is already withdrawn when the check is issued.

Sounds pretty safe, right? Actually, cashier’s checks can be faked.

Cashier's checks seem like guaranteed money, but scammers leverage that perception for profit. Don't get reeled in by these common cashier's check scams:

1. Overpayment scam
2. Escrow scam

This trick starts with the buyer sending a cashier's check for more than the agreed-upon sale price. For example, you are selling a Toyota Tundra for $50,000, and they give you a check for $55,000.

The scammer will plead with you to refund the $5,000 overage back to them right away, often claiming it was an innocent mistake. They may spin an elaborate story to convince you.

But a few days later, that cashier's check will bounce once the bank discovers it's fraudulent. Even though you initially deposited the full $55,000, the bank will pull all those funds back out of your account.

You'll be left owing the bank $55,000 for the bad check, while the scammer pockets the $5,000 cash you refunded them. Never accept a check for more than the final agreed sale amount. Insist that any overpayments get corrected on their end.

Shady buyers will insist on using a fake escrow service to scam you. They may even create the fake escrow site themselves.

You agree on a price, and the claims to fund escrow service, even showing you proof that it is holding the money. They may even have the fraudulent escrow issue you a convincing cashier’s check. You release the car, the check bounces, and the scammer and their money are long gone.

Don't get duped by escrow scams. If you’re using an escrow, don’t let the buyer pick it. Choose one that you recognize as reputable. Better yet, just use PrivateAuto's secure instant payment solution, PrivateAuto Pay.

PrivateAuto Pay is our built-in banking integration that enables instant, secure, and fee-free funds transfers up to $1M. It’s a dream come true for car sellers.


OK, so PrivateAuto Pay is great and all, but it’s a service for users of PrivateAuto’s transactional marketplace.

We’ve now made PrivateAuto Pay available for sellers on other platforms such as Craigslist and eBay Motors. You can fast-track a transaction using DealNow, and enjoy the convenience and security of instant payments, secure messaging, and electronic docu-signing.

Cashier’s checks include a number of anti-counterfeiting features. Just like cash, they are designed to be difficult to fake (though that doesn’t stop fraudsters from forging very convincing fakes).

Here are some features to search for if you’ve been given a cashier’s check:


Some fraudulent cashier checks use a legitimate national bank name but include a personal phone number, where an individual will attempt to impersonate a bank employee. When in doubt, look up the actual customer service number for the bank printed on the check. You can ask the bank itself for its authenticity.

Unfortunately, just because the money is deposited in your bank doesn’t mean the check is good. Banks are required to have your money available in days, but a well-forged check can take as long as two weeks to be identified. While the bank may attempt to track down the scammer, you’ll be required to pay the bank back for the funds, since they were never truly in your account.

A fake check is a serious offense. If you believe you’ve received a fake check, or are being asked to accept one, take action.

Report a fake check or other money scams to the Federal Trade Commission. This is the safest way to ensure the individual won’t continue to scam others.

You don’t need to receive a suspicious cashier's check in order to report a scam. Reach out if you believe you’re communicating with a fake buyer or if you’re being pressured into accepting a bank check fraud.

Complete the sales process easily and legally with the help of PrivateAuto. Our technology-driven platform helps you find verified buyers, sign documents online, and receive state-specific steps to complete the sale. PrivateAuto Pay gets you paid fast.

Sell your car on PrivateAuto today.

Looking for a used car? Browse used cars for sale by owner to find the ride of your dreams.