How to Combat Check Fraud

Check fraud is a costly problem. To combat check fraud, you should put preventative measures in place and be sure to report and prosecute all offenders to the fullest extent of the law.

Instructions

Difficulty: Moderate

Things You’ll Need:

• Check-cashing system

1. Create balances within your in-house system, if you're a business owner concerned about internal check fraud. Make sure that no one individual has the authority to access every aspect of your company's check-writing or printing system. Instead, break down the process of writing company checks into parts.
2. Ensure that the employees who have access to company accounting records do not have access to the company check-printing system. Opportunity creates temptation.
3. Spot the most common ways criminals commit check fraud. Payroll checks are the most frequently altered, and home-printed checks contain telltale features like uneven letter and number spacing and fuzzy print quality. Always make sure that you're familiar with a check's security features, and inspect each and every check you get to make sure that all safety features are, in fact, part of the document.
4. Prevent criminals from gaining access to the means through which they can commit check fraud. Protect your mail by making sure you don't leave sensitive mail sitting out overnight, waiting for a letter carrier to come take it in the morning. Contact your bank immediately if you notice any missing check numbers in your checkbook.
5. Use a gel pen, rather than a marker or ballpoint pen, when you write checks. Markers and ballpoint pen inks are soluble and can be removed from checks through a process known as "check washing." Gel-pen inks actually saturate into the paper, permanently dyeing it.
6. Combat check fraud by making sure that you never put unnecessary sensitive information on your checks, such as credit card numbers, your Social Security number or your telephone number. The inclusion of any information that could cause you serious trouble if it were to end up in the wrong hands should be avoided. Deterrence is an effective way to fight check fraud.
7. Report any individual who attempts to pass a bad check to both the police and your county attorney (or district attorney). File an official complaint, and have the individual who passed the bad check prosecuted if you're unable to recover the money you're owed.

Tips & Warnings

• If you operate a business that receives a lot of checks, you should invest in a check-cashing system. The cost of a system could pay for itself many times over considering the money you'll save by avoiding bad checks. V Systems Incorporated offers a state-of-the-art system designed to combat check fraud (see Resources below).