Combat Fraud
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Combat Fraud

The use of checks as a vehicle for fraudulent transactions is a global phenomena

Arguably the motivation for perpetrating check fraud crimes is the low risk of being caught. The figures about check fraud worldwide are impressive. Only a few organizations are publishing figures about fraud cases and money lost due to check fraud. Figures about fraud trends are rarely published. However, the American Bankers Association (ABA) makes an exception. 

Every two years they publish a report on demand-deposit-account fraud indicating some trends in the “crime of the times”.  Although the use of checks is decreasing slightly, America’s affinity to checks is diminishing slowly: 26,2 million checks were written in 2008 alone. In the last two years substantially more banks started to capture check images at ATM, branch, central processing, and/or lockbox areas. 

  • Survey results show that electronic check processing has shortened check-clearing cycle.
  • Attempted check fraud declined in 2008 for the first time in years, while overall check-fraud losses continued to climb to a new peak of U$ 1.02 billion. 
  • Debit card fraud hit small banks especially hard. The total amount of attempted check fraud against banks' deposit accounts reached an estimated U$11.4 billion in 2008. 
  • Check fraud losses incurred in 80 per cent of the banks. 
  • 761,000 cases of check fraud were reported in 2008. That’s a massive increases of 200,000 more cases than reported back in 2006. 

The Check Clearing for the 21st Century Act is now in effect for six years. It took effect on October 28, 2004. The law allows the recipient of the original paper check to create a digital version of the original check—called a "substitute check”, thereby eliminating the need for further handling of the physical document. Traditional security features such as touch, smell, and feel of paper were eliminated. Such image-based check transactions pose a threat with serious loss consequences. 

SOFTPROs solutions have been used to prevent such crimes at some of the world's leading banks. Talk to us.