Four Tips For Preventing Check Fraud

In today’s world of electronic transactions, many people still write checks. Businesses rely on checks more than individuals do. It’s estimated that check fraud costs U.S. companies $50 billion per year. If you own a business or still use personal checks, here are some tips to avoid being a victim of check fraud.

Keep Checks Secure

Never leave checks or deposit slips sitting out (or worse, visible in your car). Personal computer software, scanners, and color copiers duplicate checks easily. Also, stealing a check or deposit slip from your checkbook or going through your trash to find a canceled check is a common trick among thieves, as is stealing an outgoing check from your mailbox. Use common sense and store your unused checks and deposit slips in a locked drawer or box. Shred canceled checks, used deposit slips, and ATM receipts quickly unless you need them for tax purposes. When keeping canceled checks, make sure to lock them away.

Writing Checks

Image via Flickr by eliazar

The type of ink you write your checks with is important. Altering ballpoint or marker ink is fairly easy because the dye stays in the ink. Use gel pens instead because that ink contains particles that soak into the paper, making it harder to change the information. Never leave blank spots that allow others to add zeroes to an amount.

Always use pre-printed checks and deposit slips and double-check the account numbers when you receive your checks. Thieves commonly change the account number by one digit on a deposit slip and the money goes into the wrong account. Never make a check payable to cash because if it is lost or stolen anyone might cash it.

Business Checks

As a business owner, take advantage of all the security features available for checks. Always order from reputable check printers and ask for watermarks, fluorescent fibers, and special inks. Lock up check stock, deposit slips, bank statements, and canceled checks. Do not let the same person write checks and reconcile statements. Instead, have two people handle those jobs separately. Limit the number of check signers; the fewer signers, the less chance of fraud. Tell your bank at once of personnel changes in your accounts payable department.

Mailing Checks

Do not mail checks from home or from the street mailboxes. Believe or not, thieves steal from those big, blue Postal Service mailboxes more than people realize. Take outgoing mail to the post office. Use registered mail for checks because the Post Office keeps those letters under lock and key before delivery. Also, use proper envelopes designed for checks when mailing out. Use window envelopes that include security tabs that show any sign of tampering. Standard #10 business envelopes are too big and allow checks to move around, possibly revealing important information.

Desktop publishing software and color copy machines let thieves steal money without you knowing it. Keep yourself and your business safe by locking up checks, using standard check security features, and mailing from the post office. Keep track of your checks and lessen the chances of becoming a victim of fraud.

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