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Simple Living



The Basics of Check Fraud

by Kasey Steinbrinck

Check fraud is a costly crime that hurts consumers as well as businesses and financial institutions. It's a growing crime that leaves a trail of frustrated victims.

Unfortunately, technology has made it fairly simple for criminals to create fraudulent checks. Identity theft and check fraud can also happen because of carelessness - and that carelessness will end up costing you money.

Understanding how check fraud works and how you can prevent the different types of fraud will help to protect your household or business from becoming a victim.

There are several ways check fraud can be committed.

One of the easiest ways an identity thief can use checks to his advantage is by forging your signature. If your checkbook is stolen or misplaced, someone can write checks and sign your name to make purchases.

Banks don't always use the signature card on file to make sure the signature on a check is authentic unless a problem arises. If someone wanted to, they could write out a check to themselves for any dollar amount, then sign your name and cash it before you know something fishy is going on.

Forged endorsements are another way checks are misused. If someone steals a check written out to you, they can endorse it with a forged signature and cash or deposit the check.

Guard your personal checks carefully. Never leave a checkbook in an unsafe location. Be aware of any missing checks in your checkbook by looking for a break in the check number sequence. As soon as you notice a missing check, call your bank and have that specific check number canceled to stop payment.

Don't endorse checks made out to you until you get to the bank. Never make checks payable to "cash."

When you order personal checks online, you can choose to only enter your first initial and last name in the personal information field. That way if someone does steal your checks they won't know how to correctly forge your signature.

If someone physically alters the information already writing on a check, it's called check washing. This can be accomplished by erasing what you wrote on a check using common household chemicals. Criminals may also add digits to increase the amount a check was written out for, or change the name of the payee to their own.

Remember to fill in all areas of your check without leaving any space for alterations. Draw a line through any unused space to prevent anyone from making changes to what you wrote.

Instead of normal ballpoint pens, purchase a colorfast or gel pen to write your checks. You can buy them at just about any office supply store in your city. Gel pens can be a bit more costly, but they contain a special ink. This ink will sink into the paper fibers on your check. That makes it impossible for thieves to erase.

Try not to leave personal checks in the mailbox at your home for the postal carrier to pick up. The red flag is a dead give away to crooks that there could be checks to steal in the mailbox. The safest way to handle your bills is to drop them off in one of those big blue mailboxes - or better yet - bring them straight to the post office.

Criminals can also attempt to print their own counterfeit checks. The availability of digital printing equipment has created some major opportunities for those who commit check fraud. Anyone with a scanner, copier or printer can attempt to make their own fake checks.

Internet scams have made the use of counterfeit checks even more common in recent years. Often these scams are aimed at senior citizens, stay-at-home mothers and even students in college. Con artists may request that you wire a portion of a check to a certain individual or company. Do not fall for this trap!

Some warning signs that a check might be counterfeit include; a flimsy feeling to the paper, the bank address listed on the check doesn't match its real address, there are fewer than 9 digits in the routing number or an absence of security features.

Remember - if it seems like it might be too good to be true - it probably is.

Keep your checks from being counterfeited by shredding all canceled checks before you throw them away. Put any personal or business checks you aren't using in a safe place under lock and key.


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