If we look at the record, check frauds cost Americans around $28 million in 2019. These stats are according to the federal trade commission. But young adults are the primary and easy targets of check frauds and scams. However, if you want to avoid check fraud, it’s vital to understand these frauds.
What is check fraud?
“It’s a term that involves different types of scams. Usually, it includes fake, bad, or altered checks.”
It means the scammers alter the amount or payee name to commit fraud. As per federal reserve payments, banks process around 18 billion checks annually. Apart from this, the scammers can forge or draw checks on closed accounts. According to the American banker association, check fraud rose to $15 billion in 2018. However, this fraud is more than half of the bank’s deposit. But the banks tried to combat these frauds and blocked 91% of attempted check frauds. So, if we look in-depth, Americans lose more than a billion dollars in these frauds.
Types of check frauds:
You need to understand that check frauds are of many types and forms. The scammers send the fake check to deposit and ask to send money before the bank knows. Here are a few examples of fake check scams:
| Lottery scams | In this fraud, the scammer contacts you to win the lottery. Later, the scammers send a fake check and ask you to pay taxes. |
| Overpayment scams | Someone pretends to buy things online and then sends a check for more than the asked price. Later, the buyer asks for the overpayment back. |
| Mystery shopping schemes | A person contacts you and asks for a mystery shopping company that sells gifts and cards. But later that stranger disappears with your money. |
| Unsolicited check schemes | You receive the check-in mail, and you think it’s a rebate that you bought. But it’s a fake check scam. |
| Personal assistance | In this scam, people apply online and get hired as personal assistance. Later, the scammers ask to buy gift cards and supplies for new supplies. But it’s a scam. |
Apart from this, other check fraud types like Car wrap deals, claiming prizes, and others. So, it’s vital to get yourself educated on these scams because the fake checks look real.
How to fill out a bank check in the best way? A complete guide:
The technology has evolved, and the method of check writing has changed. But still, there are many other everyday things that you shouldn’t ignore while writing a check.
Prerequisites for writing a check:
It’s not a tough job to write a check, but many mistakes can land you in hot waters. So, here are the primary steps to follow for writing a check:
- Write the current date on the right-hand corner of the check
- Use the current date to guarantee that your record is authentic
- Write down the payee’s name to make the check as accurate as possible, and don’t commit spelling mistakes
- Most importantly, write down the amount in numbers to complete the payment box. But don’t leave an extra space where an extra digit could be added.
- If you want to avoid confusion, write down the amount in words. Usually, you should write the amount in the capital because it’s challenging to alter.
Apart from this, the check has a memo box where you can include a note. You can use the box to write down information to process your payment.
Balance your checkbook:
It’s crucial to balance your cash book monthly. You can get the bank statement online or by mail. In this way, you can compare the debit and credit sides of the bank statement. Moreover, the report includes withdrawals, checks, and unlisted deposits. If the checkbook matches the information, everything is on the right track. But if the amount doesn’t match, contact your bank and examine transactions. You can use the best paystub generator to keep track of income, expenses, and tax records.
Precautions after writing checks:
Once you have written a check, make sure you have recorded your payment. However, you can use a paper or electronic register to record the transaction. If you instantly record your expenses, then it helps you to understand:
- Prevent the bounce checks
- Helps to track spending
- Identify theft and scam in your account
But you should check the number and amount of your payment. When you balance your checkbook, it shows an accurate picture of your account. So, it’s a great way to avoid scam cash transactions.
Alterations & modifications:
After completing the full check, don’t forget to include your signature. But the banks can return your checks if these are modified or altered. There are the following reasons why a bank can return the check:
- If you used many styles of handwriting
- Used inks in many colors
- Write overs
- Or scratch something from the check
Apart from this, the financial institutes can also return checks if the date is incorrect or missing. Besides, ensure that your signatures are matching with the bank file. In addition to this, try to use electronic payments and send checks securely. So, keep the checks safe by adopting these protective measures.
Do’s & Don’ts while writing a bank check:
While composing checks, don’t ignore adding information correctly and on time. Apart from this, here are some dos and don’ts while writing down a check:
| Do’s | Don’ts |
| Use a permanent pen | Avoid writing blank checks |
| Print the value on the check because it’s hard to forge or change | Don’t print the CASH check |
| Make the consistent signature | Always verify the check |
| Use a checkbook with a carbon copy | Don’t lose your check |
| Ensure issuing bank is real | Improper disposal of checks |
| Make sure the check is valid | |
| Write fewer checks |
Note: If your check is exposed to scammers, immediately contact the bank. The bank will immediately take action to halt all transactions. You can also report scams to the Federal commission, US postal inspection services, and attorney general.
