The rise of check fraud and how to avoid it

Check fraud can lead to missed payments, late fees, and lower credit scores, and the problem is growing. According to the FBI, the number of check fraud reports doubled between 2021 and 2023, even though we’re writing fewer checks every year.

Since many of us still deal with checks on occasion, let’s look at newer types of check fraud and ways to protect yourself.

Most check fraud starts at the mailbox

In a typical scheme, the criminal steals a check from a residential mailbox or a post office collection box. Some go so far as filling out a change of address form to redirect other people’s mail to them. Once they have the check in hand, they manipulate it in one of two ways.

• Check washing: After using chemicals to remove (or “wash off”) information from the check, they fill in a new payee—typically the name of their accomplice or a synthetic ID —and a large dollar amount.

• Check cooking: The criminal uploads a photo of the stolen check, then uses software to create duplicates. Instead of cashing one large check, they write multiple checks for smaller amounts to avoid raising suspicions.

For victims, check fraud can mean spending hours figuring out what happened and untangling the mess. And if the check contained personal information, they may have to deal with identity theft on top of everything else.

How to protect yourself from check fraud

Fortunately, a few simple changes can go a long way to keeping check thieves out of your account.

Protect your mail:

• Check your mailbox every day. 
  Don’t leave mail there overnight. Sign up for free Informed Delivery from the post office to see photos of your mail before it arrives.

• Stop delivery when you’re away.
  Whether you’re taking a monthlong cruise or spending a few days with your parents, fill out a short form to place a hold on your mail until you return.

• Heading to the post office?
  Use the mail slots inside the building instead of the blue boxes outside.

Discover safer ways to pay:

• Use digital payments whenever possible.
  Mobile wallets, debit cards, electronic payments (bill pay), and credit cards provide extra protection via advanced encryption and multi-factor authentication. Plus, suspicious digital transactions can be flagged—and possibly stopped—faster than suspicious checks.

• Upgrade your checks.
  Order checks with security features like microprinting, holograms, and watermarks.

• Use the right pen.
  Indelible black ink is harder to remove. (Product review site Wirecutter recommends Sakura Pigma Micron and Uni-ball Jetstream RT.) Fill in every line, and don’t add personal details like your driver’s license or Social Security number.

• Keep an eye on your checking account.
  Sign into your account regularly to view images of recent checks and confirm the payee and dollar amount match your expectations.

• Follow up on checks that didn’t arrive.
  Contact the sender to see if there’s been a legitimate delay or if something else is going on.

Steps to take if you’re a victim of check fraud

If a criminal uses your Flagstar checking account to commit fraud, our best advice is to act quickly to avoid further damage.

• Let us know.
  Stop by a Flagstar branch, tell us what you know so far, and fill out a forgery affidavit. We’ll help you place stop payments on any outstanding checks and, if necessary, close your checking account and open a new one to prevent additional loss.

• Report it to the police.
  Write down the police report number as well as the officer’s name and contact number and share it with us.

• Report it to government officials.
  File complaints with the FBI Internet Crime Complaint Center and U.S. Postal Inspection Service.