Good question. The answer, as is often the case, is it depends. Some people think that bank drafts are just as good as cash but they’re wrong – you have to take precautions. Bank drafts are an attractive target for fraudsters because they’re easier to fake than cash and yet make them appear legitimate. Your account may initially be credited with the amount on the draft too but that won’t last long.
Fraudsters will pay for your vehicle with a bank draft, immediately advertise it (or may have it up on another website already) for below market value then sell it for cash. When you discover the bank draft is fake a week or so later you report the car stolen and the unsuspecting buyer has the car taken from them if it can be found. One person recently lost €40,000 this way and this scam regularly happens to innocent buyers and sellers. Misery for everyone but the happy fraudster.
Our advice is that you can accept bank drafts under certain circumstances. The best advice is to enter the bank branch with the prospective buyer and watch them receive the draft at the counter and immediately hand it over to you. Don’t wait outside the branch and don’t let them distract you enough to switch it with a counterfeit one.
If you can’t do that then you should get details of the bank draft in advance and check with the bank that it is legitimate and from the bank/branch it is said to be from. Also get and note the identification of the buyer – if they’re unwilling to provide these details then walk away from the deal.
Fraudsters go to great lengths to make bank drafts appear legitimate including glueing genuine holograms on it so don’t rely on your eyes. They’re also expert at crafting stories to hook you and may pay over the odds for your vehicle to entice you to accept the fake bank draft. If it seems too ‘convenient’ or too good to be true then it probably is.
Two final points – never refund any difference in the value of the bank draft and the vehicle especially if the person is offering to post the draft to you and you ship the car to them – that’s a guaranteed scam – and don’t accept cheques because they can be canceled after they’re issued.
Happy buying and selling and drop us a line on twitter @TrustHubHQ if you have any questions!