May 18, 2023
During the COVID-19 crisis, the world’s economy nearly ground to a halt, so thieves began trolling for other ways to steal your money.
They began intercepting government stimulus checks that were targeted to taxpayers. Then they feasted on billions of dollars defrauded from a federal program intended to help businesses provide paychecks to their employees during the pandemic.
Since the Coronavirus emergency has eased and the government programs have ended, criminals have returned to a classic source of thievery – check fraud.
The U.S. Postal Inspection Service reports check fraud is surging across the country, fueled by dramatic increases in theft from postal service mail collection boxes, and even armed robberies of postal carriers.
It is ironic that even as fewer people use paper checks, there have been more reports of criminals stealing checks from mailboxes, and then changing the dollar amounts and names of the recipients.
“Criminals committing mail theft-related check fraud generally target the U.S. Mail in order to steal personal checks, business checks, tax refund checks, and checks related to government assistance programs, such as Social Security payments and unemployment benefits,” according to a recent alert to banks issued by the Financial Crimes Enforcement Network (or “FinCEN”), which is part of the U.S. Treasury Department.
“Criminals will generally steal all types of checks in the U.S. Mail as part of a mail theft scheme, but business checks may be more valuable because business accounts are often well-funded, and it may take longer for the victim to notice the fraud.”
Last year, reports of check fraud filed by U.S. banks nearly doubled, with check fraud losses totaling nearly $19 billion annually, FinCEN said.
Banks across Arkansas and the nation work diligently every day to combat check fraud, using innovative methods to detect and prevent the criminal activity, which has increased by 143% in the state and 165% nationwide over the past three years, according to FinCEN data.
One common forgery scheme is known as “check washing” in which, FinCEN says, criminals steal signed checks from postal boxes, then use common chemicals like nail polish remover to remove the dollar amount and the name of the “payee,” or recipient. Then they rewrite the checks for a new recipient and a larger sum – often hundreds or thousands of dollars more – before cashing the check.
To avoid becoming a victim of check fraud, Kenny Gerhardt, senior vice president, teller operations manager at First Community Bank, suggests a few simple tips.
“If you must send a check through the U.S. mail, make time in your day to take your letter directly to the post office during business hours, and either hand it to a clerk or slide it through a mail slot inside the building,” Gerhardt said.
“Never leave envelopes containing checks in your own mailbox or in outdoor postal collection boxes after the last pickup time. Also, don’t let delivered mail sit for very long in your mailbox; pick up your mail every day as close to the delivery time as possible.”
Other suggestions:
* Use a pen with blue or black non-erasable gel ink. Gel ink soaks into paper and may be more difficult to remove or “wash” than ballpoint pen ink.
* Pay your bills online. As long as you’re not on a public Wi-Fi connection, paying bills online is safer than a check through the mail. Your bank account and the payment systems for your bills are encrypted.
* Monitor your bank account. Don’t wait for your monthly statement. Go online at least every few days to review account balances and your checks that have been cashed.
* Report incidents quickly. Contact your bank as soon as possible after suspicious activity; banks are generally required to replace funds stolen via fraudulent checks, but only if the scam is reported within 60 days of the date of your bank statement.
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