Over the years, financial banking technology has become more robust, and subsequently, fraudsters are finding more creative and efficient ways commit fraud. Pacific Premier Bank considers the security of our clients’ financial well-being a top priority. An awareness of the most common types of fraud and how to avoid them is key to prevention.

According to a 2023 Suspicious Activity report from Reuters, check fraud incidents nearly doubled between 2021 and 2022, from 350,372 to 683,541, respectively—and that number is increasing with newer scams coming to the forefront. By comparison, in 2014 the American Association of Bankers reported less than 97,000 claims of potential check fraud. 

Despite a shift by many account holders to regularly use online bill pay and other payment methods, check fraud is still on the rise. The estimated check fraud for 2023 is $24 billion, compared to $16 billion in 2017, and $4.3 billion in 2001.

Check Fraud Trends

Nearly all check fraud starts with the physical theft of a check. Once stolen, fraud can be committed in several ways. Two current trends are:

Check Washing – A type of fraud that occurs when a stolen check is treated with chemicals to remove the ink, essentially “washing” the check. Then the check is rewritten in a higher amount, addressed to a new payee, and deposited.

Check Baking – Also known as “Check Cooking,” this type of fraud occurs when a fraudster digitally alters the image of a stolen check and deposits it either as a paper check or image capture.

It’s also important to be proactive and mitigate the risk of check fraud as much as possible. Here are some helpful tips for avoiding check fraud.

DOs and DON’Ts to Help Avoid Check Scams:

• DON’T mail checks from home; instead, drop checks off inside the post office whenever possible.
• DO consider writing fewer checks; and using the Bank's secure online payment systems (wires, ACH, bill pay, etc.).
• DO consider utilizing the Bank's Positive Pay services.
• DO make a regular habit of checking mail daily to prevent check theft from your home mailbox.
• DO consistently monitor all your checking accounts to watch for suspicious transactions.
• DO use indelible or gel ink, which is harder to wash. Never provide a check with information missing such as payee or amount.

If you suspect your accounts have been compromised due to fraud or would like to speak to someone about these products and services, please contact Client Services immediately at 855.343.4070, Monday - Friday, 7:00 a.m. - 6:00 p.m. PT, and Saturday, 9:00 a.m. - 1:00 p.m. PT.

For more tools and tips, visit Pacific Premier Bank’s Cybersecurity Center.

The information expressed is being provided for informational and educational purposes only. It is not intended to provide specific advice or recommendations for any individual or business. Pacific Premier Bank does not provide tax, legal, or accounting advice, and the information contained herein should not be construed as such. You should carefully consider your needs and objectives before making any decisions. For specific guidance on how this information should be applied to your situation or business, you should consult your own tax, legal, and accounting advisors before applying any recommendation.

Pacific Premier Bank will not text, email, or call you asking for your online banking password or one-time security code. Make sure you verify the person who has contacted you before acting on any request.