@goldensky - That's a shame what happened to your neighbor. Unfortunately these types of scams happen all the time all over the world.
With today's technology anyone can print up a check that looks like a negotiable instrument but that doesn't mean the money is there to back it up.
Even bank tellers have a difficult time in determining if they're dealing with a counterfeit check or not. They might be able to confirm that the check is drawn against a legitimate bank with a real account number, but the actual check itself may not be real.