thread: Studio Scams
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Old 5th November 2018
Lives for gear
norfolk martin's Avatar

Originally Posted by Thomas W. Bethe View Post
They usually want money for "Travel Expenses" so they want to send you a check for some large amount from which you will take your studio charges and then give the rest to the band, artist or van driver. At some time in the future the check they gave you is bounced for NSF (not sufficient funds) and you are out the cash you gave them plus your studio fees. One studio I know got ripped off for $3500.
I've litigated this several times in practice. An (idiotic) friend of mine almost got caught in a similar scam - we'll pay you $2,000 to "house sit" our property for a coupe of months pending sale. We've already left the country, bu we'll send you our last US payroll check. It's for $3,000, so as soon as it clears, you need to wire us the other $1,000. We can trust you not to rip us off, right?

Fortunately , he asked my opinion before agreeing ( "If it clears, it must be OK, right, and i could really use $2,000 and a couple of rent fee months") These things always prey on people optimistically wanting to believe a good deal has come their way.

The payroll check was forged, and the local property he was going to house sit for a "couple of months pending sale" was indeed empty pending sale, but the seller had no connection to these folks, and was not seeking a "housesitter."

These scams can work because, as pipelineaudio pointed out, in the initial clearing process all that is actually checked is whether the account number the check is drawn on is good, whether the check is made out properly, whether there is sufficient funds, and whether there is a stop payment order on the check.

If those four tests are ok the bank credits your account with the amount of the check. This 'clearing" does not establish, however, that the check is genuine and authorized.

A week or more later, after you have paid out part of the "cash" that was deposited in your account to a third party, the owner of the check does their payroll accounts, and notices that there seems to be an extra check that no-one can account for. They get a copy from the bank, and it's obviously forged or stolen.

The police are contacted, and they contact your bank. The bank puts a hold on the entire amount in your account pending resolution. You also have to answer a lot of embarrassing questions from a detective (So, sir you are telling me me that you innocently got this stolen payroll check from a person in another country who you seem to know practically nothing about, and gave them a substantial amount of cash in return.....").

Unless you agree to give up all the full amount of the check from your account, you are now also a party to a lawsuit in another state, being sued by the owner of the check, who wants to recover the money .

Remember, there are at least a dozen legitimate ways to send cash to an artist/driver/transportation company without you being involved. This deposit and payout stuff is almost ALWAYS a scam because there is simply no need for it in reality.