In an era where digital transactions are increasingly becoming the norm, check fraud has nonetheless emerged as a significant issue plaguing both consumers and businesses alike. According to a recent campaign by the American Bankers Association, dubbed "Practice Safe Checks," the rise of check fraud should prompt increased vigilance in how we handle our paper transactions. As reported by Click2Houston, there were a startling 680,000 instances of check fraud reported by banks to the Financial Crimes Enforcement Network in 2023, starkly up from 350,000 in 2021.
Despite the decline in the use of checks, the problem persists. "It's a lot easier these days to get access to chemicals to wash these checks, as well as get access to software where they can actually just recreate your checks completely and cash those checks," Paul Benda of the American Bankers Association told Click2Houston. Layering onto this concern, according to a Business Alabama article, check fraud incidents have nearly doubled from 2021 to 2022 with a tumultuous jump from 350,000 to 680,000 reported incidents.
To combat this increasing threat, industry experts have offered up some actionable advice for individuals and businesses. Amegy Bank's Executive Vice President Ken Smiley suggests using electronic payment methods whenever possible, utilizing a black gel pen when writing checks, and consistently verifying check images posted to bank accounts. “Lastly, you know, check and make sure you know that when that check gets cashed so that it gets deposited, and your bank provides images of those checks,” Benda added in his interview with Click2Houston. Moreover, victims of check fraud can reach out to the Office of the Comptroller for assistance with their banks.
Businesses, in particular, are being heavily targeted, with banks adopting advanced monitoring technologies such as Positive Pay and Verafin to detect and prevent fraudulent activities. River Bank & Trust recently invested in the Verafin software which "takes our customers’ history and pulls any unusual activity like out-of-sequence numbers or amounts and images that don’t match up," the bank's COO Karen Pugh told Business Alabama. As the lamentable truth sets in that despite the march of progress, the age-old checkbook remains a vulnerability to exploit, experts are increasingly to advocate for the transition to digital payment options.
