Is Your Business Safe From Check Fraud

An unsuspecting scam

Imagine this. A seemingly nice couple approaches the checkout line to pay for some purchases. They are all smiles and very friendly. As the cashier rings up their purchases, they chat about how much they love the store and how much they can’t wait to come back. After all the purchases are bagged, the couple hands the cashier a check. The check passes smoothly through the cash register with no problems. The couple takes their purchases and thanks the cashier for such great customer service. Later on when the managers are counting the cashier’s till something just does not add up. And then they find it— a fraudulent check. 

Check fraud declining

Check fraud can happen to anyone because those committing the crime can be discrete and unsuspecting. Fortunately, ABC news reports that check fraud is declining. In an article titled, “Check Fraud Crimes Declining, But Debit Card Crimes on the Rise,” journalist Colleen Curry writes, “During a year that saw a record rise in financial crime reports, one scam that has plagued banks and consumers for decades is fading away: check fraud. Reports of suspected counterfeiting, check fraud, and check kiting were among the financial crimes that saw declines during 2011, dropping 7.5 percent from 2010. The drop in check fraud came as the Financial Crime Enforcement Network (FinCEN) had a record number of suspicious activity reports (SARs) in 2011 throughout the financial industry.”

Protect yourself from check fraud

Although check fraud is declining, checks still exist and as long as checks exist so will check fraud. In February of this year, police charged almost 70 people in Tennessee and Virginia with check fraud. Fortunately, there are ways to guard against it. One way to do that is by using electronic check payment processing such as check conversion. Bank Card Systems offers its merchants a check conversion device for check payment processing. The check conversion device accepts checks as if they were credit cards. The machine passes the check through a reader which scans and “verifies the check against a database of negative files.” These files contain information about customers who have been involved in fraud activities in the past. Devices such as these are helpful because fraudulent checks look so real nowadays. Fortunately, a check conversion device such as this one will expose a fraudulent check right away.