Even collections attorneys are susceptible to scams

[Judge Roy Bean]

Warnings are going out to collections firms to watch out for the bad-check deposit scheme.

The scammers are allegedly retaining collections law firms to recover a substantial debt from a recently defunct business that has not filed for bankruptcy. Not long after the firm sends a demand letter, this new client sends the firm a check they allegedly received from the debtor, payable to the collections law firm. They tell them to go ahead and deposit it, retain their fees/expenses and then wire-transfer the balance.

Surprise, of course - the check is a phony and if the firm doesn't wait a few days before wiring the funds they're screwed.

[Mr. Mephistopheles]

The collections firm our company has used in past must be ahead of the game on this scam. They have the ability to electronically clear checks in-house before sending on the client's share of the take.