JSA: Beware of Money Orders

The Jewelers’ Security Alliance is warning jewelers to beware of counterfeit postal money orders.

John J. Kennedy, JSA president, notes that 160 arrests have been made in the United States since October in connection with fraudulent U.S. postal money orders. Many are “good quality” counterfeits coming from Nigeria and Ghana and from countries in Eastern Europe. In most cases, notes Kennedy, “the fraud artists want to use the counterfeit money orders to pay for goods to be shipped, and jewelers are ideal targets.”

In the last year, he says, there have been “a vast number of attempts originating in Nigeria to have jewelers ship gold product using fraudulent credit card transactions.” JSA knows of at least six cases where U.S. jewelers did ship and suffered losses. One case involved almost $100,000 in gold product.

To identify a genuine U.S. postal money order, says JSA, hold it up to light and look for a watermark of Benjamin Franklin repeated on the left side, top to bottom. In addition, look for a dark security thread running top to bottom to the right of the Franklin watermark, which shows in tiny letters “USPS” along its length. It’s difficult for counterfeiters to duplicate these two security features.

Jewelers should also be aware that the maximum value for domestic U.S. postal money orders is $1,000, and $700 for international postal money orders. So, any discoloration of the denomination amount indicates there has been an erasure.

Also be suspicious if a customer asks for the exact total amount of a sale to the penny, including tax, saying he or she will return with a postal money order. “They may be setting the jeweler up for an altered money order,” Kennedy says.

Visit www.usps.com/missingmoneyorders/security.htm for more information on identifying counterfeit money orders.