Stolen check scams

[Paul F Franklin]

There have been a few articles in the press lately about thieves stealing checks, altering them, and cashing them for big dollars. They mug postmen and steal the keys that open the big mail boxes, then steal the mail looking for checks to alter.

I'm having trouble picturing how this works (no, not looking for a new job!). If I ever took a check with any indication of alteration to my bank, they wouldn't cash it. And if I wasn't a bank customer, they wouldn't even look at it. How are these thieves doing this?

Then I thought about how you can deposit checks online just using your phone's camera....I do it all the time. It would be a lot easier to slip a modified check in that way, but then the bank knows exactly who deposited it and where the money went...so...

Anybody know how this works and why all the safeguards don't work?

[Dick Strauss]

The checks get washed in a chemical solutions that dissolves the ink. They leave the now blank check to air dry while the chemicals evaporate. The scammers then write in their own amount, copy the signature and cash the check. This has been going on for decades.

[Paul F Franklin]

The checks get washed in a chemical solutions that dissolves the ink. They leave the now blank check to air dry while the chemicals evaporate. The scammers then write in their own amount, copy the signature and cash the check. This has been going on for decades.

OK, but when the fraud is discovered, isn't the person who cashed the bogus check known? What bank cashes a check for non-customers or those without proper ID. My bank won't even cash a check made out to CASH, it has to be to me.

[Jim Koepke]

OK, but when the fraud is discovered, isn't the person who cashed the bogus check known? What bank cashes a check for non-customers or those without proper ID. My bank won't even cash a check made out to CASH, it has to be to me.

Sounds like your bank might be ahead of the curve on fraud prevention.

It might not be a bank cashing the check. Many bars and small grocery stores will cash checks. Back in my early years I recall many of my coworkers would go to the nearest bar, cash our checks and have a couple beers before going home.

Most likely, someone stealing and altering checks can also come up with a phony ID.

It's an ugly world out there. That is why for most of my financial transactions my preference is to use a direct deposit or Paypal.

jtk

[Bruce Wrenn]

I'm sure if changing a check is possible, so would a phony ID wouldn't be out of the realm of possibility. I googled buying a phony id, and google only came up with 1,700,000 responses in less than a second.

[Maurice Mcmurry]

We had a student loan payment check stolen from the mail, altered and cashed back in the early 1980s. It caused a big ordeal and a bunch of fees. The fed was at 20% the missed payment bumped us up to a high risk interest rate.
The check had been made out to E. S. L. I. but was cashed by Jerome Young. Thanks Jerome

[Bill George]

I write perhaps 2 checks a month, rest is credit or debit. They are set up so over a certain amount I get a notice and I do online banking at least once per day. Never an issue and so far I have used PayPal for years, same there just look at every email as a Scam.

[Stan Calow]

Not to give anyone ideas, but what I heard was a real danger, is someone getting one of your checks. With just your name and your account number, they can order new checks from any of the check printing services, and have them sent to your "new" address. Then spend your money until caught. Even the grocery store cashier could do this, with a photo of your check. I heard that guy on which they made the film "Catch Me If You Can" talking about this on the radio.

[Brian Elfert]

The ability to order checks for any account number has been around since before the Internet. The Internet just makes it a little easier with online ordering.

I love the people who won't use a credit or debit card because they are afraid their card could be hacked, but they happily go around town writing checks with their routing number and account number right there for thieves.

[Jeff Roltgen]

I question the validity/point of debit cards altogether:

Less hassle to steal vs. paper checks and all the trappings listed above. Skim it at the pump, print a new one, and find retailers using scan only (no chip reader) card machines. Happened to me via local truck stop with my business CC a couple times until I deduced where this kept happening.
Fixed every time by CC bank, which is how I learned how this all works. Like the CC rep told me - these are not common thieves. They are highly organized groups (gangsters) that are literally printing new cards and putting them to use almost immediately, as they must act quick. Everything from plane tickets to Las Vegas, to purchasing implements at a small, independent dealer for over $20k. Interestingly, each fraudulent transaction took place in Houston, TX.
All within 12 hours....

Had it been my debit card? Bank account emptied. Little to no recourse.
= Debit card stays locked away at home. Pointless to take the risk anymore, and I continue to hear others with same experience (sadly, at same truck stop's gas pumps!).

Anyone else see this / have similar experience and sworn to using CC only, never debit?

jeff

[Walter Plummer]

Happened to us in the mid nineties. Mailed a check for my son's graduation photos and never received them. Called the firm and they said they never got the money. Turns out someone got the check and supposably used it to "buy" $20.00 of groceries and got the rest back as change. Without making any kind of endorsement on the back. I think the cashier got the $20.00 for cashing the check .We had to file a claim with the post office fraud people before the collection company would stop bothering us. We thought it was all cleared up and a few months later another collection company starts calling. Just gave them the investigation number and they quit calling.

[Brian Elfert]

I thought all of the major credit card issuers changed how business liability for fraud transactions works if the business has not upgraded to accept chip cards? Gas stations were given more time, but I believe that deadline has also passed. My understanding is a business can be held liable for fraudulent transactions if they don't have a chip reader?

[Jeff Roltgen]

Brian,
I am still wondering who ate the cost of the $20k machine - card issuer or the business? I sure didn't pay for it. Though, in the long haul, we're all paying for it then, aren't we?

jeff

[Thomas McCurnin]

As a former banker, there are many ways to do the scam. A dishonest employee of one of your vendors (Vet, Market, etc) snaps a photograph of your check and then using check stock and a magnetic printer prints your name and the magnetic account number at the bottom. It will clear. You have 30 days from the receipt of the account statement to figure the scam out and report to the bank with no risk to you.

[Bruce Wrenn]

You have 30 days from the receipt of the account statement to figure the scam out and report to the bank with no risk to you.How long does your bank have to make you whole again?

[Lee DeRaud]

Anyone else see this / have similar experience and sworn to using CC only, never debit?
(raises hand) Mine stays in the desk drawer unless I need it for the ATM to deposit a check or get cash, maybe 4-5 times per year. (Before anyone asks, I've never successfully done a deposit using check photo: problem seems to be at the bank's end, not mine.)

As far as writing checks, I wrote a total of two this year, both to the local arborist who wants a 4% "convenience fee" to do credit card...seriously considering finding someone smarter to trim my trees.

[Mike Henderson]

Brian,
I am still wondering who ate the cost of the $20k machine - card issuer or the business? I sure didn't pay for it. Though, in the long haul, we're all paying for it then, aren't we?

jeff

The deadline for having a chip reader transaction processing machine has passed. If a business does not have one - still relies on a swipe - they are liable for any fraudulent credit cards. I don't know how much a machine costs, but it's probably less than being liable for fraudulent transactions. For years, credit card sompanies have had to put up with a very large amount of fraudulent transactions - a LOT of money. And the users of credit cards were paying for that.

With the chip cards, in person credit card fraud has essentially disappeared - it's moved to the web, where people just enter their card number, expiration date, and CVV. Still a lot of fraud there.

The only in person fraud is where someone has stolen a real, physical card, and the owner had not reported the theft. I've heard of kids lending their card to someone else and then delaying reporting it stolen - enough time for the "friend" to buy some stuff. If it's a credit card and they don't detect the fraud (giving the card to someone to use fraudulently), you aren't responsible for the fraudulent use of the card. The credit card company eats it.

Mike

[Thomas Wilson]

My daughter had a check stolen from her mailbox. It was washed and rewritten for about $2000. She reported it and her account was eventually credited. Interesting consequence, she asked the bank if the thief was caught. They told her that because her loss was fully compensated, she was not an injured party and not entitled to any facts from the investigation.

[Bill Dufour]

More then 40 years ago they pried open the mail drop box and stole all the outgoing mail. Tossed the non checks. On Friday they went to downtown Oakland around 4:oo and cashed a check on my fathers account # written on a countercheck to a moving company. Excellent forgery of his signature. In our family only he knew it was a forgery until we were told it was fake. Then we could see it kind of. Busy Friday so they cashed it.
Gang was going up and down the state doing this one city at a time like once a week. Postal inspector gave my father a letter to explain missing/late payments for all the stolen checks. They broke into the mailboxes near start of months to get outgoing payments with signatures.
Bill D

[Derek Meyer]

We replaced all the credit card machines in both our stores about 17 months ago, when we switched to a new payment processor. They are Lane 7000 units, the same ones that Home Depot uses. They cost us $1100 each, so it was $44,000 for the 40 units for our two stores. Not chump change by any means.

[Ronald Blue]

I question the validity/point of debit cards altogether:

Less hassle to steal vs. paper checks and all the trappings listed above. Skim it at the pump, print a new one, and find retailers using scan only (no chip reader) card machines. Happened to me via local truck stop with my business CC a couple times until I deduced where this kept happening.
Fixed every time by CC bank, which is how I learned how this all works. Like the CC rep told me - these are not common thieves. They are highly organized groups (gangsters) that are literally printing new cards and putting them to use almost immediately, as they must act quick. Everything from plane tickets to Las Vegas, to purchasing implements at a small, independent dealer for over $20k. Interestingly, each fraudulent transaction took place in Houston, TX.
All within 12 hours....

Had it been my debit card? Bank account emptied. Little to no recourse.
= Debit card stays locked away at home. Pointless to take the risk anymore, and I continue to hear others with same experience (sadly, at same truck stop's gas pumps!).

Anyone else see this / have similar experience and sworn to using CC only, never debit?

jeff

You have many protections with a debit card just like a credit card. If you report the fraud within 2 days the liability can't exceed $50 by law. A former manager I had was hit for about 9k a couple years ago. Money was credited back no problem. He didn't get the $50 back for 2 or 3 weeks. They had to complete the investigation. I only use my debit card locally. All online is either PayPal or my credit card. You aren't more at risk using one. Many gas stations when you insert the card say on the screen chipped card inserted or something to that effect. Protects everyone. A little tip also is run your debit as a credit and you aren't entering your pin number then.

[Curt Harms]

(raises hand) Mine stays in the desk drawer unless I need it for the ATM to deposit a check or get cash, maybe 4-5 times per year. (Before anyone asks, I've never successfully done a deposit using check photo: problem seems to be at the bank's end, not mine.)

As far as writing checks, I wrote a total of two this year, both to the local arborist who wants a 4% "convenience fee" to do credit card...seriously considering finding someone smarter to trim my trees.

Charging a "convenience fee" seems common at least with American Express. I don't recall any charges for Visa/Mastercard.

[Lee DeRaud]

Charging a "convenience fee" seems common at least with American Express. I don't recall any charges for Visa/Mastercard.
Haven't had Amex since Costco switched over to Visa. There are a couple of payees I have that charge a fee for all credit cards (e.g. insurance and utilities), but this is the only one that doesn't offer some sort of EFT option.

[Jim Koepke]

Charging a "convenience fee" seems common at least with American Express. I don't recall any charges for Visa/Mastercard.

Financial institutions charge businesses a percentage of the purchase price for accepting their credit cards. Years ago vendors were prohibited by law from charging extra on credit card purchases to recoup these fees. They could offer a cash discount but that didn't happen very often. When the law was changed many gas stations went to a two tier pricing for cash versus credit.

jtk

[Mike Henderson]

Financial institutions charge businesses a percentage of the purchase price for accepting their credit cards. Years ago vendors were prohibited by law from charging extra on credit card purchases to recoup these fees. They could offer a cash discount but that didn't happen very often. When the law was changed many gas stations went to a two tier pricing for cash versus credit.

jtk

It wasn't by law, it was by the agreement with the credit card company. If they tried to charge an extra fee for use of a credit card, the credit card company could yank their ability to take credit cards.

Initially, the agreement even prohibited them from offering a different price for cash. The price had to be the same no matter what kind of payment was made. That has changed now.

Mike

[Jim Koepke]

It wasn't by law, it was by the agreement with the credit card company.

Thanks for the clarification Mike. It has been so long ago my memory has fuzzed it up a bit.

jtk

[Maurice Mcmurry]

An interesting experience that still puzzles me a little... In 2006 I was on our County Prosecutor's grand jury. One of the proposed indictment's was for a young lady who's very small paycheck was printed in error. She was due $22 and change. She received a check for $22 thousand and a few hundred. She deposited the check, waited a short time, withdrew $22 k + in cash and left town.
We were instructed in very strict terms that our civic duty was to Indict. (so we did).

[Thomas Wilson]

Once, a long time ago, we got a deposit slip back from depositing a check. The check was some real world amount, probably less than $100. The deposit was for more than $10,000,000 which we did not notice until later. The person manually keying the data had entered the account number in place of the amount. I called the bank. They had already found the mistake. No grand juries were involved.

[Kev Williams]

Been thru this nonsense--
--Video from one of my camera's of thieves who stole a couple of checks from our mailbox:


https://youtu.be/Wd-2eDChH5c

Not much the authorities could do because the license plate was too far away. What they took were 2 checks we'd written to pay for storage at 2 places.

Can't find the pics at the moment, but ours weren't the only checks they stole; they copied the bottom of one of our checks with our routing and account number and morphed it onto another check stolen from about 3 miles away which had a check number nearly the same as ours, scribbled a name on it, and WALMART cashed the thing. $998, just under the $1000 threshold, and MY BANK ACCEPTED IT-- wasn't even the same bank name, let alone not OUR names! I didn't notice it for a few months, until after I'd downloaded my ytd banking into Excel, and it showed up as the most expensive check cashed--went online, checked the bank's version of the check, wasn't even CLOSE to one of our checks... took a copy of the pic to the bank and the manager about had a fit that one of her employees didn't flag it....

They did refund our money at least.

[Bill Dufour]

California DMV and county tax board will charge a credit card fee. Only fair or it means the credit card users are paying 2% less to the government.
BilL D

[Chris Parks]

Cheques are still used in the US? I haven't seen one written or cashed for many many years and by my records the last one I wrote was back in 2013.

[Jim Koepke]

Cheques are still used in the US? I haven't seen one written or cashed for many many years and by my records the last one I wrote was back in 2013.

We moved from California to Washington in 2008. A few months before moving we ordered 800 checks. We are on our last box. We used to write a lot of checks every month. Now maybe one or two are written in a month. We used to carry a checkbook. A debit card has all but replaced the need for checks.

jtk

[Chris Parks]

I was dragged kicking and screaming into electronic funds transfer and online banking when I became the Australian distributor for Clearvue and it is the single best thing that happened in my business life. Simply put, when I see the money in my account you get the goods and that means debtors and creditors cease to be a problem in business at the level I operate at.