Detecting Check Forgery

With the advancement of technology check fraud has become increasingly easy to perpetrate. Computer generated checks are common, and provide an easy and quick method of producing checks for consumers, and potentially creating illegitimate checks for those wishing to defraud.

Check forgery affects millions at some point in there lives. When looking at a check, is it possible to accurately tell if a check has been forged? The simple answer is no. There is no way to accurately prove that a check has been forged, but there are several red flags that anyone accepting checks should be aware of. Generally, the information on the check (or lack of information) and the condition of the check itself can be good indicators that something may be amiss.

Information on the check

A check should have certain information located on it. This includes, a date, a check number, the name and address of the account holder, the name of the payee, the amount of the check written in numerals, the amount of the check written out in words, the information of the bank that it is being drawn on, the signature of the account holder, and a MICR line.

If this information is missing on a check, appears to be changed, or is inconsistent something may be wrong.

* Date

The check date should neither be in the future nor too far in the past. Anything older than six months is considered “Stale dated” and should not be accepted. If the date appears to have been altered to come into an acceptable time frame this could be a sign of forgery.

* Check Number

Most cases of check fraud occur within the first year of an account’s opening. This means that a low-numbered check is more likely to be the victim of fraud than a higher-numbered check. If, upon accepting this check, other checks from the same customer are available, is the check number consistent with the others? If the check number is the same, there is a problem. If the check number is incredibly different, like check 105 and 632, there may be an issue.

* Name and Address

The name and address should appear on the check. This should not be typewritten, but in a font consistent with the rest of the check. If the information is handwritten, this can be a red flag.

* Payee’s name

This is the person to whom the check is made payable. This should be written all in the same handwriting, and check for inconsistencies. Often in check fraud, a check made payable to a company or another individual is altered slightly to read something else. A check payable to “LCE” for example, can be altered to look like “L C Edwards” and cashed by Larry.

* Numeral amount

This can be easily altered adding extra numbers. That is why this is not considered the legal amount of the check. The only reason for referring to this amount is to verify that it matches the written amount.

* Written amount

Check to make sure that this is written in a consistent hand. If at the very beginning or end of the line there appear tightly packed letters changing the amount of the check this could be a bad sign. If those letters are in a different handwriting or different colored ink, this should be a serious red flag.

* Drawing Bank

The check should show the information of the bank it is being drawn on. If the check seems like it may be forged this can be a great opportunity to verify the check. Call the bank and give them the information of the check and ask if they would pay on it at this time.

* Signature of the account holder

The check must be authorized. Is this the same name as appears on the face of the check? Is the handwriting consistent with the rest of the face of the check?

* MICR line

Understanding the MICR line is perhaps the best way to prevent forgeries. The MICR line should be in an ink that is different than the rest of the check. This ink should appear dull, not shiny. The first series of numbers is a routing number. This should be 9 digits long. The next series of numbers is the account number. The third series of numbers is the check number. Does this match the check number on the front of the check?

Condition of the check

The physical condition of the check may also be a red flag that the check may have been forged.

Does the check have perforations? Very few legitimate checks lack perforations.

Are there any spots of blotches? Signs of erasures or alterations.

Does the font and writing on the check appear consistent? Very rarely will someone switch pens while writing a check. And the printed information should all be the same font and style.

Check forgery is a very serious crime that can have significant impact on someone’s life. It can cost more than the few dollars of the check, leading to identity theft and sometimes even to a takeover of financial accounts. As someone that accepts checks, these are the things to be watching out for. Many of these can potentially be present on perfectly legitimate checks though, so finding something wrong does not necessary indicate that it is fraud. Use good judgment, and be aware of these red flags.