Counterfeit checks are presented based on fraudulent identification or are false checks drawn on valid accounts.
Example 1: A group of criminals open checking accounts, cash counterfeit checks, and file false tax returns using fraudulent drivers' licenses, social security cards, and other identification. They use information from individual and corporate garbage as the basis for producing the identification with computer technology.
Example 2: A bank insider identifies corporate accounts that maintain large balances, steals genuine corporate checks, counterfeits them, and returns the valid checks to the bank. The bank insider is associated with a group of criminals which distributes the counterfeit checks throughout the area and cashes them using fictitious accounts.
Counterfeit check schemes can be successful when criminals are skillful in their use of technology to create false documents or have access to information and supplies from bank insiders.
To protect against such frauds, customers should protect their personal information, including account records.
Banks should: