Office of the Comptroller of the Currency

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Check Fraud: A Guide to Avoiding Losses

Check Fraud Schemes

Fraud schemes involving checks take many forms. Checks may be:

• altered, either as to the payee or the amount;
• counterfeited;
• forged, either as to signature or endorsement;
• drawn on closed accounts; or
• used in a variety of schemes.

Check fraud criminals may be bank insiders, independent operators, or organized gangs. The methods they use to further check fraud include:

• getting customer information from bank insiders,
• stealing bank statements and checks,
• working with dishonest employees of merchants who accept payments by check, or
• rifling through trash for information about bank relationships.

Descriptions of some common check fraud schemes follow, with information on what makes them successful, and what bankers can do to avoid them.

Next: Altered Checks
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