Summary
Suspicious Activity Reports related to check fraud have nearly doubled from 2021 to 2023. 1 Fraudsters take advantage of regulations requiring financial institutions to make check funds available within specified timeframes, which is often too short a window for the consumer or financial institutions to identify and stop the fraud. As a result, the compromised checks clear, and the funds are withdrawn by the criminal participants before the fraud is detected. Fraudsters gain access to legitimate checks and sensitive financial data by stealing mailed checks from USPS facilities or during delivery to the intended recipient. Check theft occurs several ways: Checks left in residential mailboxes overnight or for long periods of time USPS blue collection boxes after the last pickup time Bribery/collusion of USPS employees Preparing/Altering the Checks for Deposit To make the checks appear legitimate, fraudsters use check washing or other check "cooking" techniques to alter checks or create counterfeits. In other instances, checks are unaltered and deposited with forged endorsements.