Credit unions, called by various names around the world, are member-owned, not-for-profit financial cooperatives that provide savings, credit and other financial services to their members. These two principles in particular suggest that credit unions see themselves as educators and providers of advice to their members and that they see their role in members’ lives as being a lot more than a supplier of financial products. To live up to these ambitions, then, a credit union would fall short if their only goal was to provide the best priced individual products.
We talked about two broad strategies above and then took a small tangent to speculate on why customers and members buy products and services from banks and credit unions. There is a third broad strategy that we will now discuss and generally speaking, this strategy is how many credit unions typically try to compete. And, no, it wasn’t an email informing me that I had won a lottery and asking for my bank account and Social Security numbers so they could deposit the winnings to my bank account. However, it was a real check from a real bank with no strings attached – I could deposit it and spend the money as soon as the check cleared.
The third paragraph informed me, in bold print, that I must immediately deposit the enclosed $2,950.00 check to my bank account in order to pay the States Lottery and Gaming Commission Agency. I knew it was a scam and was not about to deposit the check, despite pleas from my 17 year old son to do so (probably hoping that I would share part of my good fortune with him), as I was certain that it would bounce and I would end up paying $25 or more in bank service charges for depositing a bad check. But I couldn’t figure out how the scamers would benefit from my paying a service charge to may bank.
On Friday I went to the bank on other business and, while there, asked the teller what could happen if I deposited check, adding that I knew it was a scam and was just trying to figure out how it worked. Finally, as a periodic user of Western Union to send money to my wife’s family in Europe for Christmas and birthdays I knew how easy this process was.
Those running the scam a month at the most between the time the checks began clearing and the accounting department at Gold Crest received their bank statement and noticed the series of check for $2,950 that the company hadn’t written. When the winners made the phone call they would be instructed to withdraw the $2,950 in CASH and then take it to Western Union and send it to the States Lottery and Gaming Commission Agency or other dummy corporation in Gibraltar. Once the fraud was discovered it would be reported to Gold Crest’s bank which would then inform the banks which had cashed the checks that they were forgeries.