When examining a check to determine whether it's real or not, it's also worth looking for other general irregularities and mistakes. Look for spelling errors or typos in the printed information on the check, such as a misspelled business name or address. You can also check to make sure that the address of the check's sender matches up with their actual address. If not, the check may likely be fake.
In addition, check that the numerical dollar amount and the written amount on the check match up. Any discrepancy is a good indication that the check is not legitimate.
- A review of simple -- but vital -- check review practices
- Check fraud is becoming more and more widespread, necessitating vigilance
- While fraud detection is getting more sophisticated, fraud techniques are simpler than ever
It's never a bad idea to encourage people to review simple safety guidelines, particularly in the realm of finance and protection against theft. PNC Insights recently posted the telltale signs of a fraudulent check, along with useful essential strategies on how to tell if a check is fake and safeguard your bank account today.
PNC reports that check fraud is on the rise, with a 23% increase in filed complaints between 2020-2021 and nearly double the number in 2022. Therefore, being aware of the following simple ways to spot a fake check:
Rough EdgesExpand
Typically, when individuals or businesses write checks, they are torn out of a book. Perforated edges help check writers easily remove the check. In that case, at least one edge of the check should be perforated or feel rough to the touch. If all four edges of a paper check are smooth, there's a likely chance the check is bogus.
Bank Logo and AddressExpand
A legitimate check features the issuing bank's logo on the front. If there's no bank logo on a check you've received, it's likely to be a fake. If there is a logo, check it against the bank's logo on its website to ensure its identical.
The quality of the printing counts, too. If the logo appears faded, it could have been scanned from a real check or taken from an online source.
Sometimes, checks also feature a bank's address next to the logo. If your check has an address, you can verify online to see if it uses the correct location for a bank branch office. If not, the check is likely fake.
MICR LineExpand
Every legitimate check includes the Magnetic Ink Character Recognition (MICR) line. This line consists of three sets of printed digital characters at the bottom of the check. The characters include the bank's routing number, the number of the account from which the check is written, and the check number, as well as two printed Transit Symbols that work with the bank's check-reading device.
The characters on the MICR line are printed with special ink that contains magnetic iron oxide, as mandated by the Federal Reserve. This magnetic ink is dull, not shiny, and the printed characters should be flat. If the MICR line printing appears shiny in the light and/or the characters are raised, the check is a counterfeit.
In addition, if there's no MICR line at the bottom of the check, it's fake.
Check NumberExpand
The check number appears on an authentic check in two places: in the upper-righthand corner and at the end of the MICR line at the bottom. If these numbers don't match up, that's a big "tell" that the check is fraudulent.
In addition, be cautious with checks whose numbers are low. Low numbers would be 101 to 400 for personal checks and 1000 to 1500 for business checks. Low numbers indicate that the account from which the check was written is new. About 90% of fraudulent checks are written from new accounts.
Paper Ink QualityExpand
Legitimate checks are written on high-quality, matte (not shiny) paper. If the check is printed on thin, flimsy, shiny paper, it's probably not authentic.
In addition, checks are printed with high-quality indelible ink. To test the ink, put a drop of water on your fingertip and run it across the check's printed surface. If the ink on the check smears or comes off when you touch it, it's probably fake.
Other IrregularitiesExpand
When examining a check to determine whether it's real or not, it's also worth looking for other general irregularities and mistakes. Look for spelling errors or typos in the printed information on the check, such as a misspelled business name or address. You can also check to make sure that the address of the check's sender matches up with their actual address. If not, the check may likely be fake.
In addition, check that the numerical dollar amount and the written amount on the check match up. Any discrepancy is a good indication that the check is not legitimate.
Staying Alert: Consumer and Financial Institutions
Of course, the best advice is simple: if you suspect a check is fake, do not cash it. Consumers should contact the bank directly to verify the check's legitimacy, and report it to the proper authorities if it is fraudulent. Depositing a fake check, of course, can lead to the bank withdrawing funds, closing the account, and negatively impacting the depositor's banking history. In extreme cases, you could even face jail time.
For financial institutions, raising awareness and providing their consumers with helpful tools and information like this is important to curb the rise in check fraud. Furthermore, deploying the latest innovations like AI and machine learning to detection anomalous behaviors and transaction and interrogating the images of checks will further decrease losses to both the financial institution and their consumers.
It will take a collaborative effort from all parties to stop fraudsters, including consumers, law enforcement, and banks. By working together, we will undoubtedly see a decrease in check fraud losses.
Posted in Check Processing, Modernizing Omnichannel Check Fraud Detection, Uncategorized and tagged Blog Post
