Scam Alert – Check Washing Fraud

Check washing is back, and it can cost you money.

Once considered an old-fashioned scam, it is popular again with fraudsters because it is so easy for crooks to alter checks with simple chemicals, and also with new digital tools like AI to forge identities and amounts.

The FBI Suspicious Activity Reports related to check fraud nearly doubled from 2021 to 2023, according to most recent figures, to more than 665,000 reports.

That’s an increase of a staggering 134% compared to 2020.  Likely, there will be similar increases for 2024 an 2025 when those figures are compiled.

It is difficult to stop check fraud because fraudsters take advantage of regulations requiring banks and other 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As a result, the compromised checks clear, and the money is withdrawn by the thieves before the fraud is detected.

Some 80% of US financial institutions report check washing fraud, or its newer version – check cooking.  

That’s when checks are manipulated digitally and either printed or deposited electronically, saving the crook a lot of time and effort.

Together, they cost consumers and their banks close to $1 Billion a year.

Why the resurgence?

Despite the rise of digital payments, checks remain widely used—especially for high-value transactions.

In fact, 91% of organizations still rely on checks, up from 75% the previous year.

Criminals exploit this continued use of old-fashioned paper checks in the mail, combining old-fashioned mail theft with new digital tools like AI to forge identities and alter check images.

According to NASDAQ, it’s popular with criminal networks as away to launder money.

How to Protect Yourself from Check Fraud

Use Fraud-Resistant Ink and Paper

Write checks with black gel pens or pigment-based ink.

• These inks soak into the paper and are much harder to remove than standard ballpoint ink.

Use checks with security features to limit the effectiveness of check washing.

• Security features can include microprinting, holograms, heat-sensitive ink, watermarks, toner adhesion, chemically reactive paper, security screens, thermal thumbprints, void pantographs, ultraviolet overprinting, security padlock icon, and fraud warnings.

Don’t Leave Spaces on a Check

• Completely fill-in the payee and amount lines.  Empty spaces invite fraudulent changes.
• Don’t write personal details, such as your Social Security number, credit card information, driver’s license number, or phone number on checks.

Never Leave Outgoing Checks in Your Curbside Mailbox. 

• Drop them in secure USPS collection boxes
• Use the mail slot inside your local post office
• Consider hand-delivering checks when possible
• Follow up with payees to make sure they received your check.

Get Your Incoming Mail Promptly

Check your mailbox daily and remove contents.

• If you’re traveling, have your mail held at the post office or ask a trusted neighbor to collect it.

Monitor Your Payments

Track when checks are usually recieved,  such as quarterly stock payments.

• If a check goes missing or is cashed for the wrong amount, contact your bank immediately to request a stop payment and report the fraud.
• Consider direct deposit for regular payments, to avoid mailing paper checks.

Consider Alternatives to Paper Checks

• Use mobile or online banking to access copies of your checks and ensure they are not altered.
• While logged in, review your bank activity and statements for errors.
• Consider using e-check, ACH automatic payments, and other electronic and/or mobile payments.
• Use check positive pay if available at financial institutions to help detect and stop fraudulent checks.
• Use checks with security features to limit the effectiveness of check washing. Security features can include microprinting, holograms, heat-sensitive ink, watermarks, toner adhesion, chemically reactive paper, security screens, thermal thumbprints, void pantographs, ultraviolet overprinting, security padlock icon, and fraud warnings.

Report Suspicious Activity

If you suspect check washing or check cooking:

• Contact your bank and request copies of the altered check
• File a report with your local police
• Report the incident to the FBI Internet Crime Complaint Center (IC3) at ic3.gov.
• Notify  the United States Postal Inspection Service at uspis.gov/report or 1-877-876-2455.

ecoXplorer Evelyn Kanter is an award-winning journalist with 25+ years of experience as a newspaper and magazine writer, radio & TV news producer & reporter, and author of guidebooks and smartphone apps – all focusing on travel, automotive, the environment and your rights as a consumer.

ecoXplorer Evelyn Kanter is President Emeritus of the International Motor Press Assn. (IMPA).

ecoXplorer Evelyn Kanter also is a member of the North American Snowsports Journalists Assn. (NASJA) and a former Board member of the Society of American Travel Writers (SATW).

Contact me at evelyn@ecoxplorer.com.

Copyright (C) Evelyn Kanter

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