In a surprising resurgence of an old-school crime, check fraud has soared by an alarming 400% over the past year, according to the Financial Crimes Enforcement Network (FinCEN), a division of the U.S. Department of the Treasury. The fraudulent activity has cost Americans $26.2 billion in 2023 alone, with scammers targeting unsuspecting individuals through a range of sophisticated and low-tech schemes.
Many fraudsters begin their operations with stolen checks. Using social media platforms like Telegram, Facebook, and TikTok, criminals share strategies and sell tools that make check fraud easy to perpetrate. Among these are universal keys capable of opening U.S. Postal Service (USPS) mailboxes and blank checkbooks readily available on the dark web.
Often, thieves resort to simply stealing checks directly from residential mailboxes. Once in possession, they employ common household chemicals like acetone to dissolve the original ink, allowing them to rewrite the check with their details or an alias.
How the Scams Unfold
Fraudsters typically deposit these altered checks via ATMs or mobile banking apps, where the initial processing appears legitimate. They then withdraw the money in small amounts to avoid detection. By the time the victim or their bank discovers the fraud, the stolen funds have often been spent or transferred.
Banks Fight Back
In response to the rising threat, banks are implementing stricter measures to combat check fraud. Policies now include longer hold times for deposits to allow thorough verification. For example, a recent loophole exploited on TikTok allowed scammers to take advantage of JPMorgan Chase’s instant deposit feature, leading to lawsuits and further scrutiny of banking processes.
These enhanced measures may inconvenience customers by delaying access to their funds, but they aim to prevent fraudulent transactions before they can occur.
Tips to Safeguard Your Finances
Protecting yourself from check fraud requires vigilance and proactive measures. Consider the following steps:
- Use USPS-approved locking mailboxes: These provide added security, making it harder for thieves to access your mail.
- Monitor bank activity: Set up alerts for suspicious transactions and check your accounts regularly.
- Avoid mailing checks: For bills or payments, use secure alternatives like Zelle, Venmo, PayPal, or ACH transfers. For sensitive mail, drop it off inside a post office rather than using outdoor mailboxes.
- Sign up for USPS Informed Delivery: This free service allows you to track your incoming mail, providing early notice if something is missing.
- Use fraud-resistant pens: Special pens designed to prevent ink alteration are a simple yet effective deterrent.
If you suspect a check has been stolen or notice fraudulent activity, report the incident immediately to your bank, USPS, and local law enforcement. Request a case number to track your claim.
For further insights into protecting yourself from scams, visit Kim Komando’s website at Komando.com, where you’ll find daily tips and resources. Stay informed to stay safe.