Know the Signs Before Check Fraud Bites

Check fraud may never cross your mind, unless you regularly write and cash checks. But it affects everyone — from older members who rely on checks for daily payments to those just entering the workforce and everyone in between. 

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While many people have turned to plastic and digital alternatives, scammers have adapted, yet check fraud is still on the rise. Why? When it comes down to it, check fraud goes beyond stealing and forging checks — it gives scammers the foundation to steal your personal information and wreak havoc on your finances. 

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The good news? There are plenty of ways to cut the line before scammers have hooked you. In this bite-sized guide, we’ll walk you through what exactly check fraud is, the most common types of check fraud, how to detect and get ahead of check fraud, and what to do if you suspect check fraud on your account(s). 

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What is check fraud?

Check fraud is the act of using a check to steal money or gain access to someone’s personal or financial information.

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In reality, a scammer doesn’t need to steal a check out of your mailbox to commit check fraud. While that is one way to do it, they can also create fake checks or convince you to deposit a fraudulent check. 

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Why does check fraud matter?

Beyond financial losses, check theft and fraud can expose scammers and bad actors to your personal and financial information. Checks typically include your full name, address, account number, and routing number. In the wrong hands, this information can cause significant damage to your finances.

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Who’s at risk for check fraud?

Many people believe that if they don’t write checks, they aren’t at risk for check fraud. This isn’t entirely true. Even if you don’t write or receive checks regularly, scammers could still target you and your information.

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The following groups face greater exposure to check fraud:

• Older Adults and Seniors: Groups that rely heavily on writing checks for bills, gifts, and other donations are prime targets for check fraud. Their risk increases if they use the mail often. 
• Households Paying Bills by Check: Rent payments and other mailed bills are attractive to scammers because they often involve large amounts of money sent at predictable times. 
• Small Business Owners: Small businesses are more likely to use checks for payroll, vendors, and other expenses. With so many checks going out at once, check fraud can easily go unnoticed. 
• Families with Shared Accounts: When multiple people access one account, unusual activity can appear “normal”. Especially if no one reviews statements regularly. 
• Young Adults and First-Time Workers: Younger groups may not write checks, but scammers get them to bite using fake jobs, prize scams, and fake online marketplace listings. 

Common Types of Check Fraud

Scammers rely on five common types of check fraud. Be on the lookout for:

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Mail Theft

Chances are, when someone says “check fraud,” this is what you think of. Scammers target residential mailboxes, apartment mailrooms, and public collection boxes for outgoing checks. Then, they alter the checks, copy them, or use them to access your banking information. 

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To reduce the risk of mail theft:

• Bring your mail directly to the post office when possible
• Avoid leaving checks in unsecured mailboxes overnight
• Monitor expected payments closely

Forged Checks

Forged checks happen when a scammer signs or changes a check’s signature. Similar to mail theft, forged checks can happen through stolen/lost checks, stolen checkbooks, and scammers stealing financial information.

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To reduce the risk of forged checks

• Check your account regularly, especially if you’re expecting a payment
• Have lost your checkbook
• Have recently sent out a payment

Check Washing

When scammers steal a check and rewrite certain information — typically the payee and the amount — this is called check washing. For example, a scammer might steal a $150 utility bill and rewrite it as a $1,500 payment to them. 

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To reduce the risk of Check Washing:

• Use permanent gel pens 
• Avoid blank spaces on checks to reduce the risk of alterations

Counterfeit Checks

Counterfeit checks are fake checks that use real information. Scammers rely on mail theft and data theft to obtain information, then use logos, account numbers, and routing numbers to make checks look legitimate. These fake checks can be used to withdraw cash, make purchases, or scam others.

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Remember, just because a check looks real, it doesn’t mean it is. 

Fake Check Scam

After a scammer makes a counterfeit check, they then use it in fake check scams. These scams often begin with an unexpected opportunity or payment.

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Immediately be suspicious of:

• Job offers that seem too good to be true
• Prizes or lottery winnings that require up-front fees
• Companies that require you to pay for supplies or equipment before you start working
• Online companies that “overpaid” you and need you to send some of the money back after you deposit the check

Scammers will ask you to deposit the check and send the “extra” back to them. They’ll often pressure you to send the money before the check clears. In reality, the check is fake, and any money you send to them will be lost.

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Remember, many of these scams now involve electronic checks, mobile deposits, and easy, instant P2P payment services like Venmo and Zelle. Most of the time, once you send that money, it’s gone.

How to Detect Check Fraud & What to Do

Since check fraud comes in many shapes and sizes, it’s important to keep an eye out for suspicious activity on your account(s) and report it as soon as possible. 

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Common warning signs of check fraud include:

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A check wasn’t processed when expected.

If you mailed a payment and it wasn’t processed in a normal timeframe, check on it. It’s not a surefire sign of fraud, but if the check is delayed, lost, or stolen, the sooner you find out, the better.

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What to do: Contact the recipient and confirm whether they’ve received the check. If they haven’t, contact your financial institution immediately. 

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A check cleared for the wrong amount.

After you sent a check, you noticed more (or less) was taken out of your account than you expected. This may be a case of check washing or alteration.

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What to do: Compare your check register and the check images to the payment information from your statement. You can find your Community South eStatements and check images via Online & Mobile Banking.

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You don’t recognize a payment.

Notice a payment on your account that you didn’t authorize to someone you don’t recognize? This could be a sign of fraud.

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What to do: Review the transaction details and contact your financial institution immediately. You can contact any Community South branch by phone or online.

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You’re missing mail. 

If your checks are missing from the mail or you’ve suddenly “misplaced” your checkbook, be on the lookout for fraud on your account(s).

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What to do: Secure your remaining checks and report any missing checks to your financial institution. If you suspect mail theft, report any missing mail to the post office.

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There’s unfamiliar activity on your account(s). 

Not all fraud appears as stolen checks or forged signatures. Sometimes, scammers steal your information and use it to gain access to your accounts.

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What to do: If you notice unfamiliar or unusual activity on your account — like small test transactions, unusual withdrawals, or multiple failed payment attempts — contact your financial institution immediately.

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Like most types of fraud, check fraud comes in many different forms — but that doesn’t mean you can’t get ahead of it! Early detection and action make all the difference. Getting into the habit of regularly reviewing your account(s), checking for missing or unusual transactions, and reporting suspicious activity immediately can help you protect your money. 

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Interested in learning more ways to stay one step ahead of scammers? Check out our financial education blogs, or give us a call. Our team is standing by and ready to help!