If you’re still issuing handwritten personal checks, you’ll want to be very aware of check fraud, which can happen at many points along the life of a paper check. Many presume check fraud begins when your check is lost in the mail. Your check fraud risk begins when your next paper check order starts its journey to your mailbox and anyone looking for the oddly specific packaging. From there, your checks remain vulnerable – stolen straight from your office, a drawer by anyone with access to your home, from your open purse, or even from the glove box of your car.
The Many Faces of Check Fraud
In today’s digital age, paper checks have more than one flaw, making them less desirable with each passing year. There are a few reasons why.
First, paper checks can be easily “washed,” meaning the entire check is erased or wiped clean, and a new recipient and amount written in. A newer trend called “check cooking” is much more insidious, as it utilizes software technology to alter your check, allowing a scammer to replicate checks easily. Fraudsters then deposit the newly created check via mobile deposit apps. They can pull the same scheme repeatedly, draining funds from your account.
Second, paper checks include a bank’s routing number and your bank account number printed on them. Fraudsters will still wreak havoc when they get hold of a signed, blank check. While leaving one of these payments for a service provider sounds like a viable idea, we discourage engaging in this practice. Not only can they fill out any amount they please, but now you’ve exposed your bank account number.
Third, the bank honors the dollar amount written out on the amount line rather than the numerical amount jotted in the box. Let’s say your check is made out for $100, but the dollar amount on the memo line says “one thousand dollars.” The bank will honor the larger written sum over the smaller amount specified in the box.
Embrace the Alternatives
Today, a multitude of alternatives to personal checks exist. Banks and businesses have made digital payments both easy and secure. Not only are they instant, saving you time and the hassle of utilizing the USPS, but they also eliminate the threat of check fraud.
Utilizing your financial institution’s billpay tool is more secure than sending personal checks by protecting your bank account number. In rare instances when a bank must issue a payment in paper form, these checks utilize a master bank account number rather than your personal account number.
With automated bill pay, and several apps to choose from to make personal payments (such as Zelle, Venmo, CashApp, or the newest app your teen introduces you to), there are fewer reasons to utilize personal paper checks. Eliminate your risk of being a fraud victim and embrace the digital age—move all your payments online.
At Organized Instincts, our daily money managers help move all payments to a more secure and paperless format. Schedule a call today and discuss how a daily money manager can help you embrace the digital age.
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