Although check usage has dropped by about 25 percent in recent years, reports of check fraud have surged, nearly doubling since 2021.
Checks contain personal and financial information that can make you a target for criminals, so it’s important to understand the risks. Learn how check fraud happens and what you can do to avoid becoming a victim of this common threat.
What Information Is At Risk?
Check writing exposes personal details that scammers can exploit, including:
- Name and Address: These can be used to steal your identity or write fake checks.
- Personal Information In the Memo Line: Social Security numbers, account numbers or purposes for payments can be misused.
- Account and Routing Numbers: These details can be used to produce counterfeit checks linked to your account, as well as originating ACH transfers or payments.
- Your Signature: A fraudulent copy of your signature makes it easier for scammers to alter or forge checks and other documents.
How Does Check Fraud Work?
Criminals often target mailboxes at residences, businesses or the blue box at post offices, intercepting incoming or outgoing mail that contains checks to alter them and steal money from your account.
Check washing is a common tactic, where chemicals erase the recipient’s name and the payment amount. The check is then rewritten to a different recipient with another dollar amount.
Armed with your account and routing numbers, scammers can also craft counterfeit checks used to make fraudulent purchases or withdraw money directly from your account.
Protecting Yourself from Check Fraud
There are several steps you can take to effectively safeguard your personal and financial information from criminals. Here are some practical ways to protect your financial security:
1. Write with Permanent Gel Pens
Unlike traditional ballpoint pens, gel ink soaks into the fibers of the paper, making it much more resistant to chemical tampering.
2. Fill In Every Space
When writing a check, avoid leaving blank spaces that fraudsters can manipulate. Draw a line through any unused space in the payment amount field to prevent it from being altered.
3. Withhold Personal Information
Never include sensitive personal details on the memo line of your check. The less information you provide, the less scammers can exploit.
4. Review Your Accounts Regularly
Use online banking to check your bank account activity often for unusual transactions or discrepancies. The earlier you catch suspicious activity, the faster you can take action to prevent further fraud. You can also use online banking to create alerts for when transactions post to your account.
5. Follow Up with Recipients
If you write a check but don’t see it clear your account after a reasonable period, follow up with the recipient to confirm whether they received it.
6. Consider Digital Payment Options
Choose digital payment methods whenever possible. Electronic transfers, credit cards, mobile payment apps and similar options are more secure.
7. Mail Checks from the Post Office
When sending a check, it’s safest to mail it directly from the post office. Never mail from the mailbox in front of your residence or business; always place checks in the blue post office mailboxes and never overnight or on weekends when they may be more vulnerable to theft.
Also retrieve mail as soon as it is delivered. If you own a business, use a post office box as mail delivered on a Saturday is a prime target for theft.
8. Have the Post Office Hold Your Mail
If you will be away for an extended period, ask the post office to hold your mail until you return. This prevents criminals from accessing any checks left unattended in your mailbox.
What to Do If You Suspect Check Fraud
It’s crucial to take immediate action to minimize potential damage and protect your finances. If you suspect you’re a victim of check fraud, follow these steps:
1. Contact Your Bank
Your first priority should be to contact your bank immediately. They can work with you to stop payment on the check, close compromised accounts and investigate the issue.
2. File a Police Report
If your check has been stolen or altered, file a report with your local police department. An official record of the incident can help authorities investigate the fraud and possibly recover stolen funds.
3. Continue to Monitor Your Accounts
Even after reporting fraud, it’s important to remain vigilant in case more suspicious activity occurs. If you notice any unfamiliar transactions or activity on your account, report it to your bank immediately.
Although checks may not be as commonly used as they once were, the financial information they contain makes them a prime target for criminals. As reports of check fraud continue to rise, staying vigilant is more important than ever. By following these protective measures, you can significantly reduce the risk of check fraud and keep your hard-earned money safe.
Visit the American Bankers Association website for more information & resources on Safe Check Practices.