Combating check scams: Still a significant obstacle in the digital age

By Todd Robertson

Checks stayed the payment technique most affected by scams activity (66 percent), reports from the 2021 Association for Financial Professionals Payments Fraud and Control Survey. Financial organizations experience deposit scams in lots of methods, consisting of fakes, forgeries, modifications, identification numbers, stop payments and examine kiting.

While lots of companies are appropriately concentrated on combating digital scams, scammers are likewise still called in to examine scams. Improving efforts to fight check scams ought to begin with banks using substantial mathematical and artificial intelligence techniques to examine transactional information, examine stock and signatures to recognize prospective suspicious products and matching danger direct exposure. Effective check scams avoidance will assist FIs avert exploiters and their most recent ingenious scams plans.

Staying ahead of scammers

The 2019 Deposit Account Fraud Survey report by the American Bankers Association revealed that check scams represented 60 percent of tried theft targeted at bank account. During the pandemic, mobile banking increased by 200 percent in brand-new registration, leaving banks susceptible to run the risk of. This development has actually offered scammers simply as much benefit as it has consumers. Perpetrators no longer need to reveal their faces at physical branches or ATMs to deposit phony checks.

Another current check scams plan banks have actually been fighting is scammers leveraging unwitting accomplices by means of Instagram. These people are getting in touch with Instagram users and paying them to utilize their accounts to devote the rip-off. Then, the scammer makes use of these accounts to publish images of savings account declarations with big balances and declares how simple it was to generate income through a “currency exchange.” If the target concurs, the scammer sends out the target a check to deposit in their savings account. Once the check is transferred, the scammer informs the target to withdraw cash from the bank account and send it by means of an online cash transfer system or through money. After a number of days, the bank informs the victim that the check was deceitful, and the victim might be accountable for the check’s quantity.

Fraudsters end up being more ingenious every year, targeting susceptible victims to perform their dubious strategies. Although check usage is not as typical in the digital age, scammers make use of checks as a hassle-free medium to make use of banks and their consumers. Fortunately for banks, a couple of essential techniques can be made use of to fight check scams in 2022.

A tested trio to discover and avoid check scams

Transaction analysis is among 3 essential tools banks can utilize to fight check scams. Transaction analysis is the procedure of analyzing bank deals to search for uncommon and suspicious activity or other problems. This essential part inspects debits and credits consisted of in deposits and withdrawals to recognize suspicious products such as out-of-range examine numbers and check quantities and replicate check numbers. It likewise uses tests at the account and entity level, determining such things as account speed, account volume, and deposits or withdrawals of uncommon quantities.

Check stock recognition is the 2nd tool utilized to fight check plans. Check stock recognition includes examining provided check images versus historic, referenced check images in order to confirm the check stock. The option assists organizations better recognize fake in-clearing and non-prescription consult higher speed, precision and dependability than visual evaluations. Check stock confirmation leverages innovation to identify aberrations that cannot be found by the human eye. It likewise decreases the variety of manual confirmations and reduces incorrect positives through digital check image analysis. This procedure enhances the check scams detection procedure and eases the problem on your internal anti-fraud group.

Signature confirmation is the last part utilized to fight check scams. This option utilizes artificial intelligence algorithms and advanced choice trees to offer a comprehensive analysis of check signatures. This leads to effective examination of suspect in-clearing and non-prescription checks and increased self-confidence levels for approval and return choices.

Signature confirmation compares digitized signatures to referenced images, handles numerous signatories on the very same account and keeps track of products needing double signatures to verify check signatures on individual and company accounts. Focusing on vibrant elements of the finalizing action, consisting of signature pieces, handwriting trajectories, and geometric analytics assists produce self-confidence scoring based upon these elements when comparing freshly provided check signatures with formerly conserved images to figure out matching and nonmatching aspects.

Check scams doesn’t appear to be decreasing anytime quickly. But there are tools banks can utilize to reduce danger and minimize scams loss. Used concurrently, deal analysis, check stock recognition, and signature confirmation empower your banks to avoid deceitful check deposits. Financial organizations that concentrate on fighting check scams will make the trust of their consumers and offer a general more secure banking experience.

As SVP for company advancement at ARGO, Todd Robertson deals with more than 425 banks to change client experiences and enhance functional performance.


A news media journalist always on the go, I've been published in major publications including VICE, The Atlantic, and TIME.

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