An overseas company hires someone to accept payments for them in the US. The payments made to this person are made by company business checks. That person takes that check and deposits it, and when the check clears after the hold is lifted, that person keeps a percentage and the balance is sent on to the hiring company overseas.
Is this breaking the law? There is no cash changing hands, and the bank checks the check and allows the deposit.
These are often scams because the hold may be released by your bank, but the check hasn't yet cleared through the paying bank. Your bank's hold, and the check actually clearing are two different things and one is not triggered by the other. If the check comes back, your bank will want their money back, and you will have only kept a small percentage, sending the rest to the scammer.
We have read of arrests for this exact scheme, most recently in Hawaii in late 2006. Ask yourself why a legitimate business would have to do this and thoroughly investigate any requests made of you to provide such a service.
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These are often scams because the hold may be released by your bank, but the check hasn't yet cleared through the paying bank. Your bank's hold, and the check actually clearing are two different things and one is not triggered by the other. If the check comes back, your bank will want their money back, and you will have only kept a small percentage, sending the rest to the scammer.