F&M Bank Blog

Check fraud is a significant and growing concern, affecting both individuals and businesses. At F&M Bank, we prioritize your financial security and aim to educate you on the risks of check fraud and how to prevent it. Continue reading to explore the various forms of check fraud, how to identity fraudulent activities, and the steps you can take to protect your finances.

What is Check Fraud?

Check fraud involves the illegal use of checks to access funds or steal money. It can take various forms and is often carried out by individuals or organized groups, leading to financial losses and potential damage to your credit. Understanding and recognizing different types of check fraud is crucial in protecting your finances.

Common Types of Check Fraud

Understanding the different types of check fraud can help you recognize and avoid them:

1. Forged Checks
   Forged checks involve altering a legitimate check or creating a completely fake one. Fraudster may forge signatures or change the details on a check to redirect funds into their accounts.
2. Counterfeit Checks
   Counterfeit checks are created to resemble a real check from real bank accounts. These checks are typically used in scams to trick individuals into depositing them and then sending money to the fraudsters before the check bounces.
3. Check Washing
   In check washing, the ink is chemically erased, allowing fraudsters to rewrite the check with their own details. This can lead to unauthorized withdrawals from your account.
4. Overpayment Scams
   In overpayment scams, a fraudster sends a check for more than the required amount and asks the recipient to refund the excess money. By the time the check bounces, the victim has already sent the refund, resulting in a financial loss.
5. Stolen Checks
   Stolen checks can be used by criminals to withdraw money or make purchases. This type of fraud often occurs when checks are intercepted during mailing or are stolen from individuals or businesses.

How to Recognize Check Fraud

Being aware of the signs of check fraud can help you act quickly to prevent losses:

• Unfamiliar Checks: Be cautious of checks from unknown sources, especially if they are for large amounts or come with a request to return a portion of the funds.
• Irregularities in the Check: Look for signs of tampering, such as alterations to the payee, amount, or date. Also, check for poor print quality or missing security features like watermarks.
• Unsolicited Checks: Be wary of checks you did not expect to receive, especially those that claim you have won a prize or inherited money.
• Urgency and Pressure: Fraudsters often create a sense of urgency, pressuring you to deposit the check and return funds quickly before the check clears.

Steps to Protect Yourself from Check Fraud

1. Secure Your Checks: store your checkbook in a safe place and avoid leaving checks in the mailbox. If possible, use electronic payment methods instead.
2. Monitor Your Accounts: Regularly review your bank statements and transaction history for any suspicious activity and report discrepancies immediately.
3. Use Secure Mailing Options: When sending checks, use secure methods like registered mail or deliver them in person.
4. Shred Old Checks: Destroy old checks and documents containing personal or financial information to prevent their use in fraudulent activities.
5. Use Online Banking Alters: Set up alters for your account to receive notifications of transactions or low balances to quickly detect unauthorized activity.

Check fraud poses a significant threat, but with the knowledge and proactive measures, you can effectively protect yourself and your finances. Your friends at F&M Bank are here to support you with secure online banking, advanced fraud detection, education resources, and customer support. If you suspect fraudulent activity or need assistance, contact us immediately. By staying vigilant and taking the right steps, you can safeguard your financial future and enjoy peace of mind.