Several body shops in Florida and Georgia have recently been hit with a check scam, in one case to the tune of $15,000.
The shops suspect an employee at a vendor they all do business with or a check processing service the vendor uses. The person is taking the routing number and checking account number off the shops’ checks, reprinting them on new, fake checks with a different name, address and bank name and spending them at Lowe’s or Home Depot. Because the Lowe’s and Home Depot stores are located by major interstates, the shops speculate that the merchandise is then being taken to a store in another state and returned for cash.
Toni Scroggins, owner of St. John’s Auto Body in Palatka, Fla., got taken for $15,000. Even though she eventually got the money back from her bank, it took two months, and she fears what that wait time could do to a smaller shop.
“I am quite big and have been here since 1978, so I was able to withstand the loss pretty well,” says Scroggins. “But waiting two months for money like that would kill a small shop.”
Scroggins says just such a small shop in her area got hit in December and then once again this week. When the fraud happens, in addition to losing the money, a shop has to go through the hassle and expense of reordering checks (in Scroggins’ case, a cost of $600) and reprogramming its credit card machines.
“You would think [the bank] would look at those checks to see whether the routing and checking numbers match the bank, but they’re not,” Scroggins says. “My CPA caught mine, because I don’t look at the books every day, but I do now because of this.”
Other instances have occurred in Ocala, Fla., and Gainesville, Fla. Layla Morris of Pello Body Shop in Brunswick, Ga., says her shop was hit, too, but fortunately the check was caught before it went through because the name and address didn’t match.
“This has happened to all of us in Brunswick except for one shop, and we think we have a common denominator, a parts company,” says Morris. “We also started asking our parts vendors about it, and they had heard of other customers having the same problem.”
Morris says shops in Kingsland, Ga., and Hinesville, Ga., have also been victimized. She says the FBI is involved, but so far the fraud has been occurring for six months and doesn’t look like it’s going to stop anytime soon.
“Our local police departments aren’t doing anything to help us either,” Morris says. “Most of our banks are catching it and not letting the checks clear our accounts, but we still have to close that account and open a new one.
“My big question is, who do you not give a check to? Without having that worry of, ‘Okay, start watching the checking account to make sure no one is trying to take our money.’ And then you’re back to, well, we have to close this account and start a new one.”