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My sister's ex-boyfriend convinced her to lend money to him so that he can lend it to some unidentified person. She lent him $25 000, and her ex probably lent $63 000 of his own money to this unidentified person. So the principle is assumed to be $88 000. This individual should have repaid the loan in January 2018, but they did not repay until October 13. The method of payment was very strange:

  1. The borrower requested my sister to provide them her banking information (bank name, transit number and account number).

  2. They walked into a branch of the bank with a $96 800 cheque (presumably $88 000 + 10% interest), advised the teller of the information of the recipient and deposited. The problem, however, is that on October 18, the cheque bounced for non-conforming signature. The online banking portal showed the name of a person, presumably the writer of the cheque, when she talked to her ex, he denied knowing who the person was.

This series of events is highly suspicious to me, I do not understand this at all. Non-conforming signature? Does that mean the cheque was fake or the signature was forged and the bank caught it so they refused to clear? If so, should I advise my sister to file a report with the local police?

Edit: my sister does not know who the money is eventually loaned to, but her ex does. The borrower of this money appears to be a Chinese citizen with permanent resident status in Canada (for reference, my sister and I are Chinese immigrants who became Canadian citizens, and her ex immigrated from Hong Kong to Canada).

Why is the Chinese connection so important? Because my sister just received word from her ex that the borrower wishes to wire transfer (meaning irreversible) money in Chinese Yuan to a Chinese bank account. He asked whether we have a Chinese bank account held by a Chinese citizen, and we gave our mother's account in China (she is a Chinese citizen who also has permanent residence status in Canada). If the money is to show up in her account, it cannot be taken back and I will promptly wire the money to Canada after converting it to CAD or USD.

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    I hope they know at least the unidentified person? This was stranger to me, then that the cheque isn't working afterwards. – chris Oct 25 '18 at 3:44
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    That sounds like your sisters ex was scammed (was it a veteran from Nigeria they met on Facebook by any chance?). The cheque was most likely fake or stolen. Your sister's ex needs to talk to law enforcement (although they probably cannot do much) and their bank's fraud department. Does the ex have a contract for the loan and and ID for this person ? Good luck, but IMHO, consider your money lost – JonasCz Oct 25 '18 at 6:37
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    It's curious that a scammer would go to the trouble of walking into a bank and depositing a fake check, several months after the scam has completed. That would seem to make the most sense if the ex is in on the scam and the sister was supposed to pass $63K of the money on to the ex before the check bounces. – Henning Makholm Oct 25 '18 at 10:22
  • They walked into a bank. Who's they? – Jan Doggen Oct 25 '18 at 11:56
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    It is your sisters ex-boyfriend. I do not know their relation, but I would not rule out that he was doing some shady deal and found her easy prey for the $25000. I would have a real good conversation with him. Note that your sister reporting to the police about the borrower is useless - your sister has an issue with her ex, not with the borrower. That is the only thing she could report. The ex can report about the borrower (maybe). – Jan Doggen Oct 25 '18 at 11:57
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If your sister loaned $25000 to her ex-boyfriend, it is the ex-boyfriend's responsibility to see that she is repaid, it is not the responsibility of some mysterious third party. The ex-boyfriend cannot hide behind the mysterious third party or use their problems with the third-party as an excuse to escape his obligations to your sister. It is your sister and the ex-boyfriend who have the (possibly verbal) contract.

Your sister could report the cheque fraud to the police but I believe she should consult a lawyer to see if it is worth suing the ex-boyfriend for his failure to repay what she lent him.

A good maxim is to regard any money lent to friends or family as a gift to them (but don't tell them that) and be pleasantly surprised if it is ever repaid. Only lend money you can easily afford to lose.

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