6 Smart Ways to Prevent Check Fraud

6 Smart Ways to Prevent Check Fraud

Although mobile banking and internet banking have occupied a prominent place in the financing industry, conventional ways are still safe for some individuals. The advancement in technology has resulted in so many fraudulent cases. So, when handling your finances, it is critical to be very careful. Check fraud occurs in three ways; counterfeiting, forgery, and alteration. Discussed below are six smart ways to prevent check fraud.

1. Examine the Check Closely

It is vital to take a closer look at the check before accepting it. Check whether the coloring is a bit off. Do the numbers on it appear legit? In case you are suspicious about it, scan the routing number to check if it is legit. You can also verify the legitimacy of the check with the source bank. If you are not able to succeed with the verification process, do not accept it. You better lose that customer than thousands of dollars.

2. Check ID

Checking the ID of the client writing you a check is the first rule before accepting any check. In all cases, the name on the check should match the ID details; if it does not, please request another mode of payment. Never comprise this rule and ensure that all your employees (or any party accepting the check on the organization’s behalf) abides by it.

3. Keep the Checks Locked Up

Most check scams take place because a check was stolen and utilized fraudulently. Advancement in technology may also enable malicious people to reproduce the check and use it. In case you must use a check to pay for the bills, ensure that only the authorized persons have access to it. Ensure the check numbers are in-sequence; if you find an out-of-sequence check, this is a sign of theft.

If possible, try and use other modes of payment to pay bills. Most companies accept direct deposits or ACH payments for bills payment. This will rule out the need to write a business check. It will also reduce the risk of a misused or stolen check.

4. Take Caution When It Comes to Cashier’s Checks

Most people assume that any check given by a cashier is legit. Unfortunately, people may reproduce cashier’s checks to appear authentic. You only realize that it’s not legit if returned for insufficient funds. A legit cashier’s check must always have a bank name and phone number. It should always have the payee’s name printed. If you suspect anything, verify the legitimacy with the bank branch.

5. Accept Checks From Recognized Clients

In case you have always transacted checks with certain clients, the chances of them committing fraud are minimal. This is the perfect way of continuing to accept checks without risking check fraud.

6. Promptly Reconcile Your Bank Statements

If you complete the process of bank reconciliation early, you will be able to spot any check fraud early. It is very difficult to stack a perpetrator if the check fraud occurred months ago. This will also make it very difficult for the bank to recompense the stolen cash.


Finally, even though the best way to avoid check fraud is to stop accepting them, this might not be possible for some businesses. If it’s necessary for your company, ensure the bookkeeper follows all the measures, including verifying and examining checks before accepting, checking ID, and keeping the checks locked up. You can prevent check fraud in your business if you have some due diligence. Refer to the above discussed smart ways of preventing check fraud if you want your business to remain safe.

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