Check fraud is not just a problem, it’s a growing epidemic that’s costing individuals and businesses billions of dollars each year. You might think paper checks are becoming obsolete in our digital world, but fraudsters have adapted, making check-related scams more sophisticated than ever. From stolen checks to altered payee fraud, criminals are always finding new ways to exploit vulnerabilities in the financial system.
So, how can you protect yourself? Whether you write checks regularly or only occasionally, understanding the risks and implementing proactive measures is key to safeguarding your finances.
The Changing Face of Check Fraud
While traditional check fraud tactics like forgery and counterfeiting still exist, criminals have developed more advanced schemes. Here are some of the most prevalent types of check fraud today:
- Check Washing – This type of fraud includes thieves stealing checks and then using chemicals to erase the ink, allowing them to rewrite the check with a different payee and a higher amount. It’s a perilous trend we’ve been seeing. Please read our blog on Check Washing Scams to learn more.
- Fake Check Scams – Fraudsters send counterfeit checks as “payment,” tricking victims into depositing them and sending money back before realizing the check is fraudulent.
- Altered Payee Checks – Scammers change the recipient’s name on a legitimate check to redirect the funds to themselves.
- Overpayment Scam – This scam has been around for years. A fraudulent buyer pays for merchandise by check, writing the check for more than the agreed-upon price. They say it was a mistake and ask you to return the difference. When you realize their check was a fraud, you’re out the returned amount and the merchandise they purchased.
- Counterfeit Checks – Fraudsters steal your credit union or bank information and print fraudulent checks, using them to clear funds from your account.
- Mailbox Theft – Criminals target residential and business mailboxes to intercept checks before they reach their intended recipients.
Warning Signs of Check Fraud
Being able to recognize red flags can help you avoid becoming a victim of check fraud. It’s not just about being cautious, it’s about being vigilant and aware. Here are some key indicators of potential check fraud:
- Unexpected checks – Be cautious if you receive a check from an unfamiliar source.
- Overpayment scams – If someone overpays you with a check and asks for a refund, it’s likely a scam.
- Delays in check clearing – A deposited check may initially clear only to bounce later when identified as fraudulent.
- Inconsistent handwriting – If the handwriting on different parts of the check appears mismatched, it may have been altered.
How to Protect Yourself from Check Fraud
To keep your accounts secure, follow these recommended strategies:
- Opt for Digital Payments – Use electronic payments, which are more secure and more challenging to manipulate than paper checks.
- Monitor Your Credit Union and Bank Accounts – Set up account alerts and review statements regularly to catch unauthorized transactions early.
- Use Secure Mailing Methods – If you must send a check, use a locked mailbox or drop it off at the post office instead of leaving it in an unsecured location.
- Invest in High-Security Checks – Many financial providers offer checks with built-in security features like holograms and watermarks, making them harder to alter.
- Shred Old Checks and Financial Documents – Prevent dumpster divers from accessing sensitive financial information by shredding sensitive information.
- Report Suspicious Activity Immediately – If you suspect fraud, immediately notify your credit union and report it to the authorities.
Take Control of Your Financial Security
Check fraud isn’t going away, but you can reduce your risk by staying informed and taking preventive measures. Benchmark Federal Credit Union is committed to helping you protect your finances with secure banking options and knowledgeable guidance.
Have questions about check security or fraud prevention? Contact us today to learn more about how we can help safeguard your accounts. Remember, if you suspect check fraud, report it to the FBI’s Internet Crime Complaint Center, your state attorney general’s office, and your financial services provider immediately.
Read our recent blog, “Tax Scams in 2025: Red Flags to Watch for and How to Stay Safe.”