Fake Check and Money Mule Scams: Why the Victim Can Owe the Bank
Independently fact-checked against primary sources (last audited October 3, 2026). · 9 primary sources cited on this page. How we verify our legal content
If you deposited a check from someone you do not know and sent part of the money back, the Federal Trade Commission warns that when the check turns out to be fake, "you're stuck paying the money back to the bank." Seeing the money in your account does not mean the check is good. Federal rules make banks release deposited funds within days, often before anyone knows the check will bounce, and the Office of the Comptroller of the Currency (OCC) has said plainly that "funds availability is not a determination that the check is legitimate."
A money mule is the other side of the same coin: someone who receives money into their own account and forwards it for someone else. The FBI warns that acting as a money mule "is illegal and punishable, even if you aren't aware you're committing a crime," while the main federal money laundering statutes are written around what a person knew. The Justice Department has used both tools: criminal charges for people it says knowingly moved fraud money, and warning letters to people "who may have been unknowingly recruited."
If it is happening to you now: stop sending money, do not deposit any more checks or accept any more transfers for this person, call your bank using the number on your card or its official app, and report it (details below). If law enforcement contacts you, talk to a lawyer before you respond.
Information last verified on October 2, 2026. This article has not been reviewed by a licensed lawyer.
Jurisdiction scope: This article covers United States federal law and federal agency guidance: Regulation CC on funds availability (12 C.F.R. Part 229), the federal money laundering statutes (18 U.S.C. §§ 1956 and 1957), the unlicensed money transmitting statute (18 U.S.C. § 1960) and the money transmitter registration statute (31 U.S.C. § 5330), plus published statements by the FTC, OCC, FBI, FinCEN and the Justice Department. Check chargebacks are governed by state law (each state's version of the Uniform Commercial Code) and by your account agreement; we describe only the uniform UCC text, not any one state's enactment. State criminal laws, wire fraud and bank fraud statutes, and bank account policies are outside this page.
If it is happening right now
- Do not send any money from a check you just deposited. The FTC's rule: "Never use money from a check to send gift cards, money orders, cryptocurrency, or to wire money to anyone who asks you to."
- Stop moving money for anyone else. If someone asked you to receive funds and pass them on, the FBI says to "Stop transferring money or any other items of value immediately."
- Call your bank or credit union. Use the number on your card or the bank's official app, not a number the other person gave you. Tell the bank about the check or the transfers and ask what can still be stopped.
- Keep everything. The FBI says to keep "any receipts, contact information, and relevant communications (emails, chats, text messages, etc)."
- Report it. Fake checks go to the FTC, the U.S. Postal Inspection Service and your state attorney general, per the FTC. Money mule activity goes to the FBI's Internet Crime Complaint Center at www.ic3.gov, per the FBI. Our guide on where to report a scam lists each agency.
- If an agent, investigator or prosecutor contacts you, or you receive a warning letter, talk to a lawyer before you respond. See when a lawyer helps after a scam.
How a fake check scam works
The FTC describes the pattern this way: "a person you don't know asks you to deposit a check. It's usually for more than they owe you, and it's sometimes for several thousand dollars. They tell you to send some of the money back to them or to another person."
The check can look completely real. The FTC says fake checks "generally look just like real checks, even to bank employees," and that they "may even be real checks written on bank accounts that belong to someone whose identity has been stolen. It can take weeks for a bank to figure out that the check is a fake."
The FTC lists these common versions:
| Version | How the FTC describes it |
|---|---|
| Mystery shopping | Your "first assignment is to evaluate a retailer that sells gift cards, money orders, or a wire transfer service." You get a check "with instructions to deposit it in a personal bank account and wire some of the money to someone else." |
| Personal assistant | You think you are hired online, "get a check and are told to use the money to buy gift cards and send the PIN numbers to your 'boss.'" |
| Car wrap decals | A company "tells you to deposit a check and then send money to decal installers." The installers are not real. |
| Claiming prizes | A sweepstakes "says you've won and gives you a check," then tells you "to send them money to cover taxes, shipping and handling charges, or processing fees." |
| Overpayments | "People buying something from you online, 'accidentally' send a check for too much, and ask you to refund the balance." |
Every version ends the same way: you send real money out (often by wire, gift card, money order, payment app or cryptocurrency) before the check you deposited fails. The FTC's advice for sellers is short: "Don't accept a check for more than the selling price."
Tech support scammers run a close cousin of the overpayment trick: they show you a "refund" that was supposedly too large and pressure you to send back the difference. Our page on tech support and fake invoice scams walks through that script.
"The check cleared, then bounced": why the money showed up
People often say the check "cleared" because the bank let them withdraw the money. That is a different thing from the check being paid. Federal law requires banks to make deposited funds available on a schedule, and that schedule can run ahead of the time it takes to discover a fake. The FTC puts it directly: "By law, banks have to make deposited funds available quickly. Even if you see the funds in your account, that doesn't mean it's a good check."
The rules come from the Expedited Funds Availability Act and the Federal Reserve's Regulation CC:
- Next business day for certain checks. Under 12 C.F.R. § 229.10(c)(1), a bank must make funds available "not later than the business day after the banking day on which the funds are deposited" for listed check types. They include U.S. Treasury checks deposited by the payee and "A cashier's, certified, or teller's check" deposited "In an account held by a payee of the check" and "In person to an employee of the depositary bank" (with a special deposit slip if the bank requires one). The same paragraph also requires next-day availability for a capped dollar amount of other check deposits.
- Second business day for a local check. Under 12 C.F.R. § 229.12(b), funds from "A local check" must be available "not later than the second business day following the banking day on which funds are deposited."
- Fifth business day for a nonlocal check. Section 229.12(c)(1) sets the fifth business day for "A nonlocal check."
Cashier's checks are on that next-day list, which is why fake ones are worth worrying about. The OCC explained in a January 8, 2007 news release about fraudulent cashier's checks:
"Funds availability is governed by the Expedited Funds Availability Act and the Federal Reserve's Regulation CC, which generally require banks to make funds available the next day in the case of a cashier's check."
and, in the same release:
"funds availability is not a determination that the check is legitimate. Fraudulent checks are very difficult to detect, and it may take several weeks for a fraudulent check to be returned to the customer's bank."
When a bank can hold a check longer
Regulation CC lets a bank set aside these deadlines in some cases. Under 12 C.F.R. § 229.13(e), the deadlines "do not apply to a check deposited in an account at a depositary bank if the depositary bank has reasonable cause to believe that the check is uncollectible from the paying bank." The regulation adds that reasonable cause "requires the existence of facts that would cause a well-grounded belief in the mind of a reasonable person." A bank that delays availability under an exception generally must give the depositor a written notice that includes the reason (§ 229.13(g)), and when an exception applies the bank "may extend the time periods established under §§ 229.10(c) and 229.12 by a reasonable period of time" (§ 229.13(h)(1)).
So a hold is not a sign the bank is being difficult. If a teller or app flags a check you were sent by someone you have never met, take the warning seriously.
Who pays when a deposited check bounces
In most fake check cases, the person who deposited the check absorbs the loss. The OCC describes what happens when a fake check is returned: "the bank reverses the deposit and withdraws the funds from the customer's account." The FTC's summary: "Fake checks can take weeks to be discovered and untangled. By that time, the scammer has any money you sent, and you're stuck paying the money back to the bank."
The legal basis for that reversal is state law. The OCC's release notes that "The Uniform Commercial Code addresses the ability of a bank to charge back checks that are returned to it, including fraudulent checks." In the uniform version of the UCC that states enact, section 4-214(a) provides that when a collecting bank has given its customer provisional credit for a check and the check is dishonored, "the bank may revoke the settlement given by it, charge back the amount of any credit given for the item to its customer's account, or obtain refund from its customer." That right is subject to timing conditions in the same section, and each state's enacted version can differ.
Meanwhile, the money you sent out usually cannot be pulled back the same way. The OCC notes that "wire transfers from the customer's account are an instantaneous and non-reversible transfer of funds."
Watch out: Whether you can also be charged overdraft fees, or left with a negative balance the bank tries to collect, depends on your account agreement and state law. We did not review those terms. Ask your bank to explain in writing what it is charging back and why.
For what to try with the money you sent (a wire recall, a gift card issuer, a payment app), see how to get money back after a scam, which covers refund rights by payment method. If you sent the money through Zelle, Venmo, Cash App or PayPal, our Zelle and payment app scams guide covers those companies' policies.
What is a money mule?
Definition. FinCEN, the Treasury Department's financial crimes bureau, quoting the FBI, defines a money mule as "a person who transfers illegally acquired money on behalf of or at the direction of another."
The FBI's Houston field office, in a December 11, 2020 release, described "witting and unwitting victims acting as money mules to move illegally-obtained money between different payment accounts," often in different countries, "on behalf of others."
A fake check victim and a money mule can be the same person. Someone hired for a remote "job" may be told to deposit checks, receive transfers, or open accounts, and then forward the money. The first role exposes them to a loss; the second can also expose them to legal risk.
FinCEN's three kinds of money mule
FinCEN's July 7, 2020 advisory (FIN-2020-A003) sorts mules into three groups:
- Unwitting or unknowing: an individual who is "unaware that he or she is part of a larger criminal scheme."
- Witting: an individual who "chooses to ignore obvious red flags or acts willfully blind to his/ her money movement activity."
- Complicit: an individual who is "aware of his/her role as a money mule and is complicit in the larger criminal scheme."
These are FinCEN's descriptions for financial institutions spotting suspicious activity. They are not legal tests, and which one fits a particular person is a question for that person's lawyer, not a page like this.
How people get recruited as money mules
The FBI says recruiters "often target the elderly, students, those looking for work, or those on dating websites. Money mules often receive a commission for their service, or they might help because they believe they have a trusting or romantic relationship with the individual who is asking for help."
The Justice Department's May 10, 2024 announcement said: "Many money mules begin as victims of romance or lottery scams and are unknowingly lured by fraudsters into transmitting fraud proceeds based on lies. Other money mules are recruited into what they initially believe to be legitimate work-at-home jobs."
Common routes in:
- Work-at-home jobs that have you receive and send money through your own bank account, or open a new account for the "employer." The FBI's red flags below describe both.
- Romance and online relationships. The person you met online asks you to receive money for them and send it on. Relationship-based investment scams are covered in our guide to crypto and investment scams.
- Lottery scams, which the Justice Department names alongside romance scams as a starting point for many mules.
Because the FBI says recruiters often target the elderly, our elder fraud guide covers how families and banks can help.
Am I a money mule? Warning signs
The FBI's red flags, in its own words:
- "Do not accept job offers that ask you to use your own bank account to transfer their money."
- "Be wary when an employer asks you to form a company to open a new bank account."
- "Be suspicious when the individual you met on a dating website wants to use your bank account for receiving and forwarding money."
The FBI also notes that mules "often receive a commission for their service." Being paid a commission to receive money and pass it on fits that description. If any of this describes what you are doing, stop moving money now. That is the step every agency on this page agrees on.
What federal law says about moving fraud money
Several federal statutes reach people who move criminal proceeds. The three criminal statutes each contain a knowledge element as written, but what the person must know differs from one statute to the next. The table summarizes the text; it does not say whether any statute applies to you.
| Statute | What it prohibits (statutory text) | Knowledge element in the text | Maximum the statute sets |
|---|---|---|---|
| 18 U.S.C. § 1956(a)(1) (money laundering) | Conducting a financial transaction involving proceeds of "specified unlawful activity," with intent to promote that activity or knowing the transaction is designed to conceal the proceeds, among other listed purposes | "knowing that the property involved in a financial transaction represents the proceeds of some form of unlawful activity" | A fine of the greater of $500,000 or twice the value of the property, or up to 20 years in prison, or both |
| 18 U.S.C. § 1957(a) (monetary transactions) | Engaging in "a monetary transaction in criminally derived property of a value greater than $10,000" derived from specified unlawful activity | "knowingly engages or attempts to engage" | A fine, or up to 10 years in prison, or both |
| 18 U.S.C. § 1960(a) (unlicensed money transmitting) | Conducting, controlling, managing, supervising, directing or owning "all or part of an unlicensed money transmitting business" | "knowingly conducts..."; the state-license category applies "whether or not the defendant knew that the operation was required to be licensed or that the operation was so punishable"; another listed category covers a business moving funds "known to the defendant to have been derived from a criminal offense" | A fine, or up to 5 years in prison, or both |
| 31 U.S.C. § 5330(a) (registration) | A registration duty, not a crime by itself: "Any person who owns or controls a money transmitting business shall register the business... with the Secretary of the Treasury" | Not stated in the quoted text | A civil penalty of $5,000 for each violation, with each day a separate violation (§ 5330(e)); failing to register is also one of the categories of unlicensed business in 18 U.S.C. § 1960(b)(1)(B) |
Two definitions in § 1956 matter for anyone reading the table. Under § 1956(c)(1), "knowing that the property... represents the proceeds of some form of unlawful activity" means the person "knew the property involved in the transaction represented proceeds from some form, though not necessarily which form, of activity that constitutes a felony." Under § 1956(c)(2), to "conduct" a transaction "includes initiating, concluding, or participating in initiating, or concluding a transaction." Section 1956(b)(1) also provides a civil penalty of the greater of the value of the property involved or $10,000.
Under 18 U.S.C. § 1960(b)(2), "money transmitting" includes "transferring funds on behalf of the public by any and all means." Whether a person forwarding money for a scammer is running a "money transmitting business" is a legal question the statute's text does not answer for any particular case.
What the FBI and DOJ say about unknowing mules
The agencies' public warnings are blunter than the statutes' text. The FBI's 2020 Houston release says: "Acting as a money mule is illegal and punishable, even if you aren't aware you're committing a crime." The Justice Department's December 3, 2021 announcement quoted an FBI official saying the same thing: "even if you don't know you're committing a crime, acting as a money mule is illegal and punishable."
The Justice Department's own enforcement descriptions draw a line between groups. Its May 10, 2024 release said its actions "ranged from criminal prosecutions designed to punish those intentionally assisting fraudsters to warning letters intended to advise those who may have been unknowingly recruited by fraudsters." Its December 3, 2021 release said: "Some money mules are aware that their actions facilitate international fraud schemes. Others, however, first interact with fraud schemes as victims and may be unaware that their actions are furthering criminal activity."
We report these statements as the agencies' positions. This page does not tell you whether you are or are not criminally liable. That depends on facts and law a lawyer needs to review.
DOJ warning letters
The Justice Department describes the Money Mule Initiative as an annual campaign. Its 2019, 2021 and 2024 announcements are quoted here. Each announcement describes warning letters as a separate track from prosecutions:
| Announcement | What DOJ said about warning letters |
|---|---|
| December 4, 2019 | It "served over 500 warning letters on individuals who recently served as money mules," and "The letters informed recipients that they could be prosecuted if they continue aiding and abetting fraud schemes." |
| December 3, 2021 | "Law enforcement served approximately 4,670 letters warning individuals" |
| May 10, 2024 | "Participating agencies served approximately 2,970 letters warning individuals that their actions were facilitating fraud schemes." |
On the prosecution side, the 2021 release reported that "Civil or administrative actions were filed against 11 individuals" and that "more than 30 individuals were criminally charged." The 2024 release said "more than 20 individuals were criminally charged for knowingly receiving and forwarding victim funds or otherwise laundering fraud proceeds."
The 2024 release says the letters "warned individuals that their activities are facilitating fraud and outlined the potential consequences of continuing to transmit illegally acquired funds." If you receive one, take it as an instruction to stop moving money for anyone, keep every record, and get advice from a lawyer licensed in your state.
Other consequences for money mules
Criminal exposure is not the only risk the FBI names. Its 2020 release says: "Serving as a money mule can also damage your credit and financial standing. Additionally, you risk having your own personally identifiable information stolen... and you may be held personally liable for repaying money lost by victims."
If you gave the person running the scheme your bank details, Social Security number or a copy of your ID, our guide to what to do when a scammer has your information covers credit freezes and the next steps, and the identity theft section covers reporting.
What to do if you think you are being used as a mule
The FBI's list, verbatim:
- "Stop communication with the suspected criminal(s)."
- "Stop transferring money or any other items of value immediately."
- "Maintain any receipts, contact information, and relevant communications (emails, chats, text messages, etc)."
- "Notify your bank and the service you used to conduct the transaction."
- "Notify law enforcement."
- "Report suspicious activity to the FBI's Internet Crime Complaint Center (IC3) at www.ic3.gov and contact your local FBI field office."
Do not try to "fix" things by sending the money back to the person who sent it to you, and do not keep forwarding funds while you sort it out. Let your bank tell you what to do with money still in your account.
Pro tip: If you are worried about how a report or a call to your bank might affect you, that is a reason to talk to a lawyer, not a reason to keep moving money. Our guide to when a lawyer helps after a scam explains free and low-cost routes.
Where to report a fake check or mule scheme
- Fake checks: the FTC says to report to "the Federal Trade Commission," "the U.S. Postal Inspection Service" and "your state Attorney General." The FTC's reporting site is ReportFraud.ftc.gov, and its Spanish-language site is ReporteFraude.ftc.gov.
- Money mule activity: the FBI says to notify your bank and report to IC3 at www.ic3.gov.
- Your bank or credit union: in every case, as early as possible.
The where to report a scam guide explains what each agency does with a report. A report does not by itself reverse a payment, so call your bank first. For the full picture of scam types and your options, start at our scams and fraud laws hub.
Related guides
- Scams and fraud laws: what to do if you got scammed
- How to get money back after a scam
- Zelle and payment app scams
- Tech support and fake invoice scams
- Crypto and investment scams
- Elder fraud
- When a lawyer helps after a scam
- Mail Theft and Check Washing
- Online Shopping and Marketplace Scams
This article provides general legal information about United States federal law and agency guidance, verified on October 2, 2026. It is not legal advice. For your specific situation, contact your bank, the agency named above, or a lawyer licensed in your state, especially if you have been contacted by law enforcement.
Last updated: October 2, 2026.
Frequently Asked Questions
Is it a scam if someone sends me a check and asks me to send some back?
The FTC describes exactly that pattern as a fake check scam: a stranger asks you to deposit a check, usually for more than they owe you, and send some of the money back. Its advice is never to use money from a check to send gift cards, money orders, cryptocurrency or wires to anyone who asks.
The check cleared, so why did it bounce later?
Regulation CC (12 C.F.R. 229.10 and 229.12) requires banks to make deposited funds available within set deadlines, and the OCC says funds availability is not a determination that the check is legitimate. A fake check can take weeks to be returned.
Do I have to pay the bank back for a fake check?
The FTC warns that victims are usually stuck paying the money back to the bank, and the OCC says the bank reverses the deposit and withdraws the funds from the account. The chargeback right comes from state law based on the Uniform Commercial Code and your account agreement.
How long can a bank hold a check?
Regulation CC sets availability deadlines, but under 12 C.F.R. 229.13(e) they do not apply when the bank has reasonable cause to believe the check is uncollectible. The bank must give you a notice with its reason and may extend the hold by a reasonable period.
Am I a money mule?
FinCEN defines a money mule as a person who transfers illegally acquired money on behalf of or at the direction of another. If someone you met through a job offer, dating site or prize asks you to receive money and send it on, the FBI says to stop transferring money immediately and notify your bank.
Can I get in trouble for being a money mule if I did not know?
The FBI says acting as a money mule is illegal and punishable even if you are not aware you are committing a crime, while the federal money laundering statutes are written around what a person knew. Whether you face liability depends on your facts; talk to a lawyer, especially if law enforcement contacts you.
What is a DOJ money mule warning letter?
The Justice Department has announced that law enforcement agencies served thousands of letters to people who may have been unknowingly recruited as mules, warning that their activities are facilitating fraud and outlining the potential consequences of continuing. If you receive one, stop moving money and get advice from a lawyer licensed in your state.
Where do I report a fake check or money mule scheme?
The FTC says to report fake checks to the FTC, the U.S. Postal Inspection Service and your state attorney general. The FBI says to report money mule activity to IC3 at www.ic3.gov and to notify your bank.
Updates
Independently fact-checked against the cited primary sources
The Law Behind This Article
This article rests on the statutory provisions below, held in our own legal record and retrieved from the official source. Tap a section to read the operative text.
Code of Federal Regulations Title 12
§ 229.10Next-day availability.In force
(a) Cash deposits. (1) A bank shall make funds deposited in an account by cash available for withdrawal not later than the business day after the banking day on which the cash is deposited, if the deposit is made in person to an employee of the depositary bank. (2) A bank shall make funds deposited in an account by cash available for withdrawal not later than the second business day after the banking day on which the cash is deposited, if the deposit is not made in person to an employee of the depositary bank. (b) Electronic payments —(1) In general. A bank shall make funds received for deposit in an account by an electronic payment available for withdrawal not later than the business day after the banking day on which the bank received the electronic payment. (2) When an electronic payment is received. An electronic payment is received when the bank receiving the payment has received both— (i) Payment in actually and finally collected funds; and (ii) Information on the account and amount to be credited. A bank receives an electronic payment only to the extent that the bank has received payment in actually and finally collected funds. (c) Certain check deposits —(1) General rule.
Official text (excerpt) · last checked 2026-07-28 · Read the full text in our law library · Verify at ecfr.gov
Cited in 19 court opinions in our collectionLatest citing opinion in our collection: 2025
Opinions citing this section in our collection:
- Nix v. NASA Federal Credit Union (District Court, D. Maryland 2016, 200 F. Supp. 3d 578)“…12 U.S.C. §§ 4001-4010 ; and its implementing regulations, 12 C.F.R. § 229.10 et seq. (Count I); disclosed his per…”
- First Security Bank of New Mexico, N.A. v. Pan American Bank (Court of Appeals for the Tenth Circuit 2000, 215 F.3d 1147)“…owing the business day on which the transfer was received. 12 C.F.R. § 229.10(b). We cannot ascertain from th…”
- Jicarilla Apache Nation v. United States (United States Court of Federal Claims 2011, 100 Fed. Cl. 726)“…s have next-day availability. 12 U.S.C. § 4002 (a)(2)(A); 12 C.F.R. § 229.10 (c)(l)(i). Under these provisions, once…”
Identified automatically from the court opinions citing this section — not a ranking of which case controls.
§ 229.13Exceptions.In force
(a) New accounts. For purposes of this paragraph, checks subject to § 229.10(c)(1)(v) include traveler's checks. (1) A deposit in a new account— (i) Is subject to the requirements of § 229.10 (a) and (b) to make funds from deposits by cash and electronic payments available for withdrawal on the business day following the banking day of deposit or receipt; (ii) Is subject to the requirements of § 229.10(c)(1)(i) through (v) and § 229.10(c)(2) only with respect to the first $6,725 of funds deposited on any one banking day; but the amount of the deposit in excess of $6,725 shall be available for withdrawal not later than the ninth business day following the banking day on which funds are deposited; and (iii) Is not subject to the availability requirements of §§ 229.10(c)(1)(vi) and (vii) and 229.12. (2) An account is considered a new account during the first 30 calendar days after the account is established. An account is not considered a new account if each customer on the account has had, within 30 calendar days before the account is established, another account at the depositary bank for at least 30 calendar days. (b) Large deposits.
Official text (excerpt) · last checked 2026-07-28 · Read the full text in our law library · Verify at ecfr.gov
Cited in 15 court opinions in our collectionLatest citing opinion in our collection: 2025
Opinions citing this section in our collection:
- Haas v. Commerce Bank (District Court, S.D. New York 2007, 497 F. Supp. 2d 563)“…See id. § 4003(a); see also 12 C.F.R. § 229.13 (a)(l)(i). The Act defines “business da…”
- Essex Construction Corp. v. Industrial Bank of Washington, Inc. (District Court, D. Maryland 1995, 913 F. Supp. 416)“…sonable exceptions in cases of deposits that exceed $5000. 12 C.F.R. § 229.13 (g) accordingly prescribes ’ the form a…”
- Oak Brook Bank v. Northern Trust Company (Court of Appeals for the Seventh Circuit 2001, 256 F.3d 638)“…could have refused withdrawal for seven business days, see 12 C.F.R. §§ 229.13 (b), (h)(1), (h)(4), and thus until Feb…”
Identified automatically from the court opinions citing this section — not a ranking of which case controls.
§ 229.12Availability schedule.In force
(a) Effective date. The availability schedule contained in this section is effective September 1, 1990. (b) Local checks and certain other checks. Except as provided in paragraphs (d), (e), and (f) of this section, a depository bank shall make funds deposited in an account by a check available for withdrawal not later than the second business day following the banking day on which funds are deposited, in the case of— (1) A local check; (2) A check drawn on the Treasury of the United States that is not governed by the availability requirements of § 229.10(c); (3) A U.S. Postal Service money order that is not governed by the availability requirements of § 229.10(c); and (4) A check drawn on a Federal Reserve Bank or Federal Home Loan Bank; a check drawn by a state or unit of general local government; or a cashier's, certified, or teller's check; if any check referred to in this paragraph (b)(4) is a local check that is not governed by the availability requirements of § 229.10(c). (c) Nonlocal checks —(1) In general.
Official text (excerpt) · last checked 2026-07-28 · Read the full text in our law library · Verify at ecfr.gov
Cited in 8 court opinions in our collectionLatest citing opinion in our collection: 2026
Opinions citing this section in our collection:
- FIRST NAT. BANK IN HARVEY v. Colonial Bank (District Court, N.D. Illinois 1995, 898 F. Supp. 1220)“…on a local check available two days following the deposit. 12 C.F.R. § 229.12 (b)(1). During this two-day period, the…”
- Machinski (District Court, D. Utah 2026)“…for withdrawal within a specified schedule/timeframe. 12 C.F.R. § 229.12. Plaintiff, in his Statement of Facts, p…”
- Maine Family Federal Credit Union v. Sun Life Assurance Co. (Supreme Judicial Court of Maine 1999, 1999 Me. 43)“…le banking laws, including Regulation CC. See 12 C.F.R. §§ 229.12 (c), 229.13(b) (1998). [¶31] The…”
Identified automatically from the court opinions citing this section — not a ranking of which case controls.
United States Code Title 18
§ 1956Laundering of monetary instrumentsIn forcecited in 3 of our articles
Whoever, knowing that the property involved in a financial transaction represents the proceeds of some form of unlawful activity, conducts or attempts to conduct such a financial transaction which in fact involves the proceeds of specified unlawful activity— with the intent to promote the carrying on of specified unlawful activity; or with intent to engage in conduct constituting a violation of section 7201 or 7206 of the Internal Revenue Code of 1986; or knowing that the transaction is designed in whole or in part— to conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds of specified unlawful activity; or to avoid a transaction reporting requirement under State or Federal law, shall be sentenced to a fine of not more than $500,000 or twice the value of the property involved in the transaction, whichever is greater, or imprisonment for not more than twenty years, or both.
Official text (excerpt) · last checked 2026-07-28 · Read the full text in our law library · Verify at uscode.house.gov
Cited in 6,323 court opinions in our collectionLatest citing opinion in our collection: 2026
Opinions citing this section in our collection:
- United States v. David Allen Hagen Defusco, (Two Cases) (Court of Appeals for the Fourth Circuit 1991, 949 F.2d 114)“…ea, for laundering of monetary instruments in violation of 18 U.S.C. § 1956 (a)(l)(A)(i) and conspiring to conceal…”
- Ratzlaf v. United States (Supreme Court of the United States 1994, 510 U.S. 135)“…70, Tit. XIII, § 1352(a), 100 Stat. 3207 -18, codified at 18 U. S. C. § 1956 (a)(2)(b) (prohibiting various transact…”
- United States v. Gilbert Isgar (Court of Appeals for the Fifth Circuit 2014)“…conspiracy to engage in money laundering, in violation of 18 U.S.C. § 1956(h), and aiding and abetting money laund…”
Identified automatically from the court opinions citing this section — not a ranking of which case controls.
Also relied on in: Romance Scams: Warning Signs and What to Do If You Sent Money, Deepfake Fraud and Impersonation Laws: Federal and State (2026)
§ 1957Engaging in monetary transactions in property derived from specified unlawful activityIn forcecited in 2 of our articles
Whoever, in any of the circumstances set forth in subsection (d), knowingly engages or attempts to engage in a monetary transaction in criminally derived property of a value greater than $10,000 and is derived from specified unlawful activity, shall be punished as provided in subsection (b). Except as provided in paragraph (2), the punishment for an offense under this section is a fine under title 18, United States Code, or imprisonment for not more than ten years or both. If the offense involves a pre-retail medical product (as defined in section 670) the punishment for the offense shall be the same as the punishment for an offense under section 670 unless the punishment under this subsection is greater. The court may impose an alternate fine to that imposable under paragraph (1) of not more than twice the amount of the criminally derived property involved in the transaction. In a prosecution for an offense under this section, the Government is not required to prove the defendant knew that the offense from which the criminally derived property was derived was specified unlawful activity.
Official text (excerpt) · last checked 2026-07-28 · Read the full text in our law library · Verify at uscode.house.gov
Cited in 1,984 court opinions in our collectionLatest citing opinion in our collection: 2026
Opinions citing this section in our collection:
- United States v. Cooks (Court of Appeals for the Fifth Circuit 2009, 589 F.3d 173)“…convicted Cooks on seven counts of money laundering, under 18 U.S.C. § 1957(a), a provision that prohibits knowingl…”
- United States v. Serge Edouard (Court of Appeals for the Eleventh Circuit 2007, 485 F.3d 1324)“…and 1957 (Count 2); and money laundering, in violation of 18 U.S.C. § 1957 (Counts 3-11). The indictment also inc…”
- Yeager v. United States (Supreme Court of the United States 2009, 557 U.S. 110)“…f (2000 ed.), and 17 CFR § 240 .10b5-l (insider trading); 18 U. S. C. § 1957 (money laundering). While petit…”
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§ 1960Prohibition of unlicensed money transmitting businessesIn force
Whoever knowingly conducts, controls, manages, supervises, directs, or owns all or part of an unlicensed money transmitting business, shall be fined in accordance with this title or imprisoned not more than 5 years, or both. As used in this section— the term “unlicensed money transmitting business” means a money transmitting business which affects interstate or foreign commerce in any manner or degree and— is operated without an appropriate money transmitting license in a State where such operation is punishable as a misdemeanor or a felony under State law, whether or not the defendant knew that the operation was required to be licensed or that the operation was so punishable; fails to comply with the money transmitting business registration requirements under section 5330 of title 31, United States Code, or regulations prescribed under such section; or otherwise involves the transportation or transmission of funds that are known to the defendant to have been derived from a criminal offense or are intended to be used to promote or support unlawful activity; the term “money transmitting” includes transferring funds on behalf of the public by any and all means including but not…
Official text (excerpt) · last checked 2026-07-28 · Read the full text in our law library · Verify at uscode.house.gov
Cited in 143 court opinions in our collectionLatest citing opinion in our collection: 2026
Opinions citing this section in our collection:
- United States v. Michael Lord (Court of Appeals for the Fifth Circuit 2019, 915 F.3d 1009)“…t to distribute (Count Fifteen). MSBs are subject to 18 U.S.C. § 1960, which criminalizes the failure to obta…”
- United States v. Banki (Court of Appeals for the Second Circuit 2011, 685 F.3d 99)“…ensed money-transmitting business, in violation of 18 U.S.C. § 1960; Count Two: Violating, or aid…”
- United States v. Galo Velastegui, Also Known as Galo R. Velastegui, and Gmj Travel & Shipping Corp. (Court of Appeals for the Second Circuit 1999, 199 F.3d 590)“…d in the indictment falls within the ambit of conduct that 18 U.S.C. § 1960 (a) makes criminal. Accordingly, we rev…”
Identified automatically from the court opinions citing this section — not a ranking of which case controls.
United States Code Title 31
§ 5330Registration of money transmitting businessesIn force
Any person who owns or controls a money transmitting business shall register the business (whether or not the business is licensed as a money transmitting business in any State) with the Secretary of the Treasury not later than the end of the 180-day period beginning on the later of— the date of enactment of the Money Laundering Suppression Act of 1994; or the date on which the business is established. Subject to the requirements of subsection (b), the Secretary of the Treasury shall prescribe, by regulation, the form and manner for registering a money transmitting business pursuant to paragraph (1). This section shall not be construed as superseding any requirement of State law relating to money transmitting businesses operating in such State. The filing of false or materially incomplete information in connection with the registration of a money transmitting business shall be considered as a failure to comply with the requirements of this subchapter. The registration of a money transmitting business under subsection (a) shall include the following information: The name and location of the business.
Official text (excerpt) · last checked 2026-07-28 · Read the full text in our law library · Verify at uscode.house.gov
Cited in 30 court opinions in our collectionLatest citing opinion in our collection: 2026
Opinions citing this section in our collection:
- United States v. Banki (Court of Appeals for the Second Circuit 2011, 685 F.3d 99)“…ting business registration requirements under [31 U.S.C. § 5330, which require money- tran…”
- United States v. Mazza-Alaluf (Court of Appeals for the Second Circuit 2010, 621 F.3d 205)“…l money transmitting registration requirements codified at 31 U.S.C. § 5330, see 18 U.S.C. § 1960(b)(1)(B). On thi…”
- United States v. E-Gold, Ltd. (District Court, District of Columbia 2008, 550 F. Supp. 2d 82)“…a “money transmitting business” per se is at 31 U.S.C. § 5330 . Section 5330 defines a money transmit…”
Identified automatically from the court opinions citing this section — not a ranking of which case controls.
United States Code Title 12
§ 4002Expedited funds availability schedulesIn force
Except as provided in subsection (e) and in section 4003 of this title, in any case in which— any cash is deposited in an account at a receiving depository institution staffed by individuals employed by such institution, or funds are received by a depository institution by wire transfer for deposit in an account at such institution, such cash or funds shall be available for withdrawal not later than the business day after the business day on which such cash is deposited or such funds are received for deposit.
Official text (excerpt) · last checked 2026-07-28 · Read the full text in our law library · Verify at uscode.house.gov
Cited in 28 court opinions in our collectionLatest citing opinion in our collection: 2026
Opinions citing this section in our collection:
- Credit Union National Ass'n v. Board of Governors of Federal Reserve System (District Court, District of Columbia 1988, 700 F. Supp. 1152)“…ess day on which such funds are available for withdrawal.” 12 U.S.C. § 4002 (c)(1). 4 The Act further…”
- Pemberton Sales & Service, Inc. v. Banco Popular De Puerto Rico (District Court, Virgin Islands 1994, 877 F. Supp. 961)“…pon which the funds become available. See 12 U.S.C. § 4002 (b)(1). January 18, 1991 was a Friday.…”
- Nix v. NASA Federal Credit Union (District Court, D. Maryland 2016, 200 F. Supp. 3d 578)“…after the business day on which such funds'are deposited.” 12 U.S.C. § 4002 (A); see also 12 C.F.R. § 229.10 . I…”
Identified automatically from the court opinions citing this section — not a ranking of which case controls.
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Sources and References
- FTC, How To Spot, Avoid, and Report Fake Check Scams (June 2025)(consumer.ftc.gov).gov
- OCC News Release 2007-2 on fraudulent cashier's checks (Jan. 8, 2007)(occ.gov).gov
- FBI Houston, FBI Warns of Money Mules (Dec. 11, 2020)(fbi.gov).gov
- U.S. Department of Justice, U.S. Law Enforcement Takes Action Against More Than 3,000 Money Mules (May 10, 2024)(justice.gov).gov
- 12 C.F.R. § 229.10, Next-day availability (Regulation CC)(law.cornell.edu)
- 12 C.F.R. § 229.12, Availability schedule (Regulation CC)(law.cornell.edu)
- 12 C.F.R. § 229.13, Exceptions (Regulation CC)(law.cornell.edu)
- Uniform Commercial Code § 4-214, Right of charge-back or refund (uniform text)(law.cornell.edu)
- FinCEN Advisory FIN-2020-A003, Imposter Scams and Money Mule Schemes Related to COVID-19 (July 7, 2020)(fincen.gov).gov
- 18 U.S.C. § 1956, Laundering of monetary instruments(law.cornell.edu)
- 18 U.S.C. § 1957, Monetary transactions in property derived from specified unlawful activity(law.cornell.edu)
- 18 U.S.C. § 1960, Prohibition of unlicensed money transmitting businesses(law.cornell.edu)
- 31 U.S.C. § 5330, Registration of money transmitting businesses(law.cornell.edu)
- U.S. Department of Justice, U.S. Law Enforcement Targets Fraud Facilitators (Dec. 3, 2021)(justice.gov).gov
- U.S. Department of Justice, Justice Department Announces Landmark Money Mule Initiative (Dec. 4, 2019)(justice.gov).gov
- FTC, Contact the Federal Trade Commission (ReportFraud.ftc.gov)(ftc.gov).gov
- FTC, Protecting Older Consumers 2024-2025 (Dec. 1, 2025), lists ReporteFraude.ftc.gov (Spanish)(ftc.gov).gov