Common Types of Check Fraud
Check fraud can take many forms, including:
- Forged checks – when someone signs another person’s name without authorization.
- Altered checks – when details such as the payee or payment amount are changed.
- Counterfeit checks – entirely fake checks created to look authentic.
- Stolen checks – when physical checks are intercepted and used without permission.
- Check kiting – exploiting the float time between banks to draw funds that don’t exist.
How Check Fraud Happens
Fraud often occurs when checks are stolen from the mail, intercepted during processing, or manipulated after being written. Criminals may use technology to produce convincing forgeries, or they may exploit weak internal controls that make it easier for fraudulent checks to slip through.
Why it's a Concern
Check fraud exposes organizations to financial loss, reputational damage, and operational disruptions. For governments and nonprofits, it can also erode public trust. Strong internal controls, secure banking processes, and proactive monitoring are key defenses against this risk.
What's important here?
Check fraud occurs when criminals forge, alter, or steal checks to gain unauthorized funds. Even in the digital age, it remains a significant threat to governments and nonprofits. Protecting against it requires strong safeguards, oversight, and fraud-resistant payment practices.
