| As opening new lines of credit becomes more difficult, | | | | steals a check and cashes or deposits it. There's really |
| identity thieves are gravitating toward check fraud. | | | | nothing anyone can do to protect themselves from |
| Check fraud is a billion dollar problem. As predicted by | | | | this, aside from guarding their checks and going over |
| the Identity Theft Resource Center, check fraud, which | | | | their bank statements carefully. |
| accounted for 12% of financial crimes in 2007, | | | | Counterfeit checks can be created by anyone with a |
| increased to 17% in 2008. According to the American | | | | desktop scanner and printer. They simply create a |
| Bankers Association Deposit Account Fraud Survey | | | | check and make it out to themselves. In order to |
| Report, $969 million were stolen via check fraud in | | | | prevent your checks from being counterfeited, make |
| 2006, up from a reported $677 million in 2003. Of the | | | | sure you shred all canceled checks before throwing |
| $969 million dollars lost to check fraud, 38% was stolen | | | | them away, and be sure to lock up any checks in your |
| through return deposit scams, 27% was stolen using | | | | home or office. Consider a locked mailbox so nobody |
| cloned checks, 28% was stolen using counterfeit | | | | can access your bank statements. You should also |
| checks, and 7% was stolen by altering or washing | | | | seriously consider using online banking exclusively, and |
| checks. | | | | discontinuing paper statements. |
| In an article in The New York Post, a brazen ring of | | | | Check kiting or check floating usually involves two |
| thieves enlisted crooked bank tellers to run a check | | | | bank accounts, where money is transferred back and |
| fraud scheme that was brought down when the | | | | forth, so that they appear to contain a balance which |
| crooks made the mistake of forging checks from a | | | | can then be withdrawn. A check is deposited in one |
| NYPD account. Two criminal hacker ringleaders | | | | account, then cash is withdrawn despite the lack of |
| organized the counterfeit scam, using 950 "soldiers," or | | | | sufficient funds to cover the check. In this case, it's |
| "mules," to deposit and cash counterfeit checks, netting | | | | generally the bank or whoever cashed the check that |
| them millions of dollars. Three bank tellers were | | | | gets burnt, unless they are able to go after the person |
| involved, stealing and selling customer profiles which | | | | who used their own account. |
| included names, Social Security numbers, and account | | | | Check washing involves altering a legitimate check, |
| numbers. Insider identity theft of this kind accounts for | | | | changing the name of the payee and often increasing |
| up to 70% of all instances of identity theft. | | | | the amount. This is the sneakiest form of check fraud. |
| Check fraud victims include banks, businesses and | | | | When checks or tax-related documents are stolen, |
| consumers themselves. Our current system for | | | | either from the mail or by other means, the ink can be |
| cashing checks is somewhat flawed. Checks can be | | | | erased using common household chemicals such as |
| cashed and merchandise can be purchased even | | | | nail polish remover. This allows the thieves to endorse |
| when there is no money in the checking account. | | | | checks to themselves. In this case, something as |
| I presented a program on motivation and | | | | simple and inexpensive as a select uni-ball pen can |
| self-improvement at a women's prison in | | | | help. Select uni-ball pens contain specially formulated |
| Massachusetts a few years back. I requested a little | | | | gel ink (trademarked Uni-Super Ink(TM)) that is |
| background on the women I was speaking to, just | | | | absorbed into the paper's fibers and can never be |
| because I watch too many movies and I wanted to | | | | washed out. The pen costs two bucks and is available |
| know if there was any possibility I'd get shanked. The | | | | at any office supply store. |
| case worker informed me that about 80% of the | | | | If you write a check to pay a bill and then put it in your |
| women were incarcerated for check fraud and | | | | mailbox for the postal carrier to deliver, you put |
| shoplifting. It seems that when some people get a | | | | yourself at a higher risk for check fraud. Thieves see |
| checkbook, they consider it an opportunity to print | | | | that red flag up and go phishing for checks. I suggest |
| money. | | | | using a uni-ball pen and taking checks directly to the |
| There are numerous forms of check fraud: | | | | post office, or dropping them in a big blue mailbox. |
| Forged signatures are the easiest form of check | | | | If you plan to do any online banking, which millions do, |
| fraud. These are legitimate checks with a forged | | | | make sure your PC is protected with anti-virus |
| signature. This can occur when a checkbook is lost or | | | | software and all your critical security patches in your |
| stolen, or when a home or business is burglarized. An | | | | operating system are up to date. |
| individual who is invited into your home or business can | | | | Further, you can't prevent all forms of identity theft. |
| rip a single check from your checkbook and pay | | | | However you can significantly reduce your risk by |
| themselves as much as they like. Banks don't often | | | | making a small investment in your personal security by |
| verify signatures until a problem arises that requires | | | | investing in identity protection or considering the options |
| them to assign liability. | | | | described in this blog post. |
| Forged endorsements generally occur when someone | | | | |