Wednesday, August 31, 2005

Addressing Qchex Fraud

One subject, I've received a lot of comments on is Qchex. Qchex allows people to receive checks through the internet. Their site warns the prospective consumer that they accept no liability and will not investigate anything regarding the checks they send out.

They seem to have become a fraudster's best friend.

Criminals across the world quickly took advantage of the service Qchex offers in Nigerian Letter, Lottery and Auction (Advance Fee) scams. In these scams, an unsuspecting person is promised a large amount of money from a lottery winning, or for helping foreign royalty etc. They are then sent a Qchex item, allegedly to cover a tax or tariff and are told to cash it and wire the money (normally overseas). In auction variety of this scam, Qchex are used to purchase high ticket items, which are normally shipped overseas, or they are sent an amount over the purchase price and asked to kindly wire the excess money. In the end, the check returns and they are held financially and in some cases, criminally responsible.

The banks do not always detect the fraud and more victims are created when their accounts are drained through the use of Qchex. In these instances, since the money is normally reimbursed, if the bank can't return it to someone, they themselves become the victim.

Please note that many other financial instruments are used in these scams, primarily counterfeit items. With QChex, it made the process easier since it takes skill and resources to produce quality counterfeit items.

The good news is that the FDIC and the Privacy Rights Clearinghouse have officially complained. Qchex is claiming that they have now come up with a solution that will verify that the right person is using the account in question. According to Qchex, their new controls are reducing the number of complaints.

Quite frankly, due to Qchex's initial lack of response to the problem, I'm going to wait and see if they have truly taken a bite out of the criminal activity their service supports. I checked their security disclosure at today. It still has the disclosure of what I term as (no accountability), along with some ludicrous examples of how they enhance your security by doing business with them. The most amusing was "Registering your bank accounts with Qchex ensures no one else can setup or access your account numbers on the Qchex system." I guess that means if you do business with them, they will catch on if the criminals try to use your account at Qchex?

I would ask anyone, who is aware of any recent fraud with Qchex to click on the title of this post, which will take you to a site where you can complain to the FDIC.

You can also make the Privacy Rights Clearinghouse aware of any recent activity by visiting their site at:

In many of the replies, I've received about Qchex, people were so angry they suggested suing them. There are attorneys out there that deal in fraud litigation. Here is a link to a simple search listing some of them on Yahoo.

I'm not an attorney, but after dealing with some of the victims on this, it is clear that they have been damaged financially.


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prying1 said...

Yeah Right - I'm really going to go to QChex (sounds like a breakfast cereal) and trust those jokers by registering any of my account numbers. Do they sell bridges too?

Perhaps they live by the philosophy that it is morally wrong to allow a fool to keep his money.

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