Protecting a personal checking account from tampered check fraud can be as easy as changing the way the check is written.
The use of personal checks is fading toward obscurity. We pay our bills online and Venmo the babysitter. The plumber takes credit cards and your food delivery payments are automatic.
The American Bankers Association -- flooded the media with messages about the rise of check fraud, including all those ads you hear on WTOP -- launched its "Practice Safe Checks" campaign, along with its "Banks Never Ask That" fraud campaign, which is one of the biggest nationwide media spends in ABA history.
It is because there has been a dramatic rise in check fraud, more than doubling since 2021, despite a 25% decline in check writing over that same time.
Criminals employ many methods, including checks stolen from mailboxes, tampering with checks that are already written, like changing the entries, and fake checks using consumers' or businesses' information. All it takes is a name of a few numbers.
"We've done such a good job of making people aware of the dangers of internet banking, so they actually think writing a check is safer, especially for the older generation. When you think about it, though, would you ever give a piece of paper with your name and your address and your bank account number and routing number on it to a total stranger?" said Paul Benda, executive vice president of risk, fraud, and cybersecurity at the American Bankers Association.
Protecting a personal checking account from tampered check fraud can be as easy as changing the way the check is written.
"Using a gel pen or a sharpie, something that is a lot harder for a criminal to wash out, is really important. Making sure you fill up that space so you don't leave space in front or behind of that number you write at the end that will allow them to turn that $1,000 check into a $10,000 check," Benda said
While the use of personal checks has dramatically declined, businesses -- particularly small businesses -- still write a lot of them, accounting for most of the 13 million checks that are processed daily.
There are new protections for commercial checking customers, including services called Positive Pay, and Payee Positive Pay.
"You register every check that you write. And before that check can be funded when it is cashed, you have to approve that check. Positive Pay allows you to check the value of that check and check number. Payee Positive Pay is a little more complex and actually allows you to verify the payee," Benda said.
Consumers who fall victim to personal check fraud are not ultimately on the hook for losses. Business accounts might be.
"For a consumer account, generally you are going to be protected from check fraud. If someone steals your check and washes it, that becomes an improperly payable instrument, which means you did not authorize it. For a commercial customer, it can vary, depending on what type of account you have and what mitigation measures are in place, and the agreement you have with the bank," Benda said.
A guide to safe check writing and protecting against check fraud is on the American Bankers Associations' Practice Safe Checks website.
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