What Are the Different Types of Check Fraud?

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  • Written By: Alex Tree
  • Edited By: Heather Bailey
  • Last Modified Date: 20 September 2016
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Check forgery, counterfeiting, and alteration are among the many different types of check fraud. In addition, check kiting is a type of fraud that involves “floating” a positive balance in one or more bank accounts. These acts are illegal in most places, and can result in fines, imprisonment, or both. In the end, however, the lost money and fees are often passed onto innocent people in the form of increased banking fees.

Whenever someone signs and uses a check without permission, it is forgery. This is true whether the check is from the person’s employer, friend, or family member. In some cases, the check is stolen from a stranger, and the person had no right to possess the document in the first place. Sometimes, this type of fraud is used in conjunction with a stolen or fake identification card to get the retailer or financial institution to accept it.

Counterfeiting is another type of check fraud, but it is more involved than forgery. To counterfeit a check, a person can either photocopy an existing check or use computer software to design a new check, and then use a high quality laser printer to print it. This may take a bit of skill and expensive electronics to successfully pull off.


Check alteration is very different from check counterfeiting, but it is similar to forgery in some ways. The writing on the check is altered using household chemicals to erase them, then rewritten to be cashed to the alterer or retailer. Some check alterers only erase the “pay to” portion of the check, while others go as far as to increase the amount of the check. For example, in one case, a check was altered to be worth $24,000 US Dollars (USD) rather than the original $240 USD.

Another type of check fraud is called check kiting or check floating, which is complicated compared to other methods. Basically, a person opens two bank accounts and writes a check to one. It can take weeks for a bank to process that check and realize the other account does not have sufficient funds. Before an overdraw happens, the person usually writes another check to the other bank account to cover the non-existent funds in the first account. In many cases, the person eventually deposits enough money to cover the balance rather than keeping both accounts afloat.


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Post 17

A friend asked me to cash her payroll checks by depositing them into my account for the cash. She said she had lost her ID and couldn't cash the checks. I had done it once for her and there was no problem. She asked me to do it again this time for two payroll checks, which I deposited into my bank and advanced her the $1000.

The checks were canceled by her employer, it seems, after she had me deposit them. She called her employer and told him they were stolen. The employer now is filing charges against me for fraud. How do I prove that she asked me to deposit the checks into my bank account for her? I'm feeling really stupid right now.

Post 15

My friend is in jail. He has given me permission to write a check on his bank account to get him out of jail. Is this the correct way to do this?

Post 14

My friend verified a check via phone call for someone else, not realizing until afterward that they would/could be in trouble for doing so. Am I right for telling them this could lead to trouble for them?

Post 13

@Tomislav: Actually, I don't know how easy it is to do the type of check fraud that was depicted in "Catch Me if You Can," but I do know that check fraud is still a problem!

The statistics are saying, even with the reduction in check use, it is still one of the go-to ways people use for stealing, even though there is a check fraud punishment with felony type charges!

Post 12

I was curious about check fraud statistics after watching the movie starring Leonardo DiCaprio, named "Catch Me if You Can."

I forget what year it was that was depicted in the movie, but it was a young man who figured out different ways to commit check fraud and eventually was caught. I have to imagine it has become much more difficult to create fake checks now than it was earlier!

Post 11

@lighth0se33: That is the worst feeling when you are standing in line at a checkout and realize that someone has wiped out your bank account. It happened to me when I gave to what I thought was a reputable charity.

An old man had a table set up on the town square. He said he was accepting donations for American veterans. Wanting to be patriotic, I made him out a check for $25. He smiled, thanked me, and I walked away feeling good.

My mood changed three days later when my card got declined at a pharmacy. The bank told me that someone had cashed a check from me for $2500. They were really nice and got it all straightened out for me, but they may never catch the guy. I think he probably wanders from town to town, altering checks along the way.

Post 10

I tried to help out a relative who had just got out of rehab. It backfired on me when he altered my check.

I knew that he needed a place to stay, and I believed that he had truly recovered from his meth addiction. He seemed so normal and balanced. He told me that he had found an apartment for only $300 a month, but he needed a deposit. He also said that he had a job lined up, and he could pay me back within the month.

I wanted to help him because I knew no one else would. I gave him the check. The next week, I was trying to buy groceries when my debit card was declined

due to insufficient funds. I contacted my bank, and they told me that I was overdrawn by $2,000. My relative had altered the check by adding an extra zero. Since I only had $1,000 in the account, his $3,000 check put me under.
Post 9

I know a girl who has always had an addiction to stealing, whether it be merchandise or money. Feeding her addiction was the fact that she never seemed to get caught. That all changed once she started forging checks.

Her employer had placed her in charge of payroll. He still had to sign the checks, but she had to determine the amount and distribute them. Well, she studied his signature and practiced copying it at home. She perfected the art, and she began making small checks out to herself from the company here and there.

By the time they noticed the money was missing, she had already amassed over a thousand dollars in stolen funds. They pressed charges, and she got a year in prison. However, since it was her first offense that they knew about, she only had to serve three months in an actual prison. The rest of her sentence is being carried out as house arrest.

Post 8

I have a friend who worked for some really shady people. The company was a small advertising service that distributed free newspapers around the community, but they often tried to scam people out of money.

My friend’s boss gave her some checks and told her to sign certain names on different ones. She asked him about the legality of it, and he told her she would be fired if she didn’t do it. She told him that she would rather be unemployed than in jail for check fraud, so he let her go.

She secretly kept the list of names he had given her to sign on the checks. She went to the police and handed over the list to save these poor people from having money stolen from their accounts. Her boss had to serve several years for this, because they found that he had been doing it before he even hired her.

Post 7

@ceilingcat: I'm glad the bank stepped in and helped you. I know it was their mistake, but sometimes banks handle problems in a less than timely fashion.

I had no idea there were so many ways to commit check fraud. People certainly are inventive. I accept checks as payment at my job sometimes, and I'm going to be sure to pay much closer attention to the checks in the future.

Post 6

I was accused of check fraud a few years ago, but luckily I was able to get the issue fixed quickly. I had my purse stolen with all my cards in it, so I had my bank close my checking account and I opened a new one.

However, the bank made a big mistake and sent me new checks with the old account number on them. So all the checks I wrote for a few weeks were written on the old account that was closed and had no money in it!

Luckily, when the error was discovered the bank quickly fixed it. They funded all the checks I had written with money from my new account. Everyone got paid, and I didn't have to go to court for check fraud. The situation had a speedy resolution, but it sure was stressful for a few days.

Post 5

Do you know whether or not signing a check for a loved if they ask you to is illegal?

My grandmother is getting up there in age and with her arthritic hands she has been having a lot of trouble writing and maintaining her records. She has been getting others in the family to sign her checks for her.

Is there any way we can legally protect ourselves when we are asked to sign a check for someone and cash it?

We know technically it is forging a signature, but it isn't like the owner of the check doesn't know. We'd really like to sort this out in a legal way so everyone feels comfortable.

Post 4

@Sara007: Check the dollar amount for tampering. Make sure the person's ID matches the information on the check with no misspellings. If everything looks good, I think the rest depends on store policy. You could call the number on a check or contact the bank to confirm its validity, but these things take time and you probably have a line of customers.

Many stores can now instantly process checks and hand them back to the customer, virtually eliminating this problem.

Post 3

Does anyone know what the easiest way to spot a fraudulent check is? Do they look a little off or is it pretty much impossible to tell?

I work in retail and am always worried I am going to accept a fake check and get dinged for it. I try my best to look at identification, but sometimes I am not sure what to do when something seems off. Our training really only gets us so far and unless we're suddenly really good a spotting fake ID our job is really tough.

We've had a few fake bills passed at our store location already and I am sure bad checks have gone through too. It is so hard to tell with these things.

Post 2

@Mutsy: I know that check fraud penalties can be stiff depending on the state you are in, but most check fraud convictions can result in fines of to $1,000,000 and thirty years in prison which involves fake check fraud which is cashing checks that are not even real.

I was watching a movie that was a true story about a man that had created fake payroll checks and cashed about $4,000,000 dollars worth of fake payroll checks before he was caught.

He became an expert in duplicating the numbers and codes on the bottom of the checks. He also went as far as using the same type of paper and having additional seals to boosts its authenticity.

When he was

caught he was eventually convicted and sentenced to ten years in prison, but the FBI was so fascinated with the way he created these fraudulent checks that they offered him a job in their check fraud detection department.

They felt that he was an expert in this field and he would be able to help the FBI catch more criminals.

Post 1

I just wanted to say that when I used to work in a grocery store, we always had be on the lookout advisories regarding people that were looking to get their checks cashed, but did not have any money in the account. My manager was telling us that many of these people would have multiple bank accounts and write several checks on one account and back it up with checks from another account.

In some cases these advisories told us that people were using stolen checks and requested that we make sure we checked their identification when cashing checks because most of the time these checks belonged to victims of muggings and armed robbery.

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