Cases of cheque fraud continue to drop

This week in the press there have been several reports of would-be cheque fraudsters who have been caught out trying to use cheques fraudulently.

A woman from Ireland altered a cheque by adding an extra digit before trying to pay it into her account, and a 22-year-old from Wigan attempted to cash in a stolen cheque. Both were caught before the cheques were processed.

These cases are not isolated, in fact in 2013, 93% of attempted cheque fraud was spotted and stopped in the cheque clearing process. Overall, cheque fraud is on a downward trend. Figures published earlier in the year by Financial Fraud Action UK show that cheque fraud was at its lowest level last year – down from losses of £35.1 million in 2012 to £27.5 million in 2013.

Cheque FraudImage source: Financial Fraud Action UK.

Of the three types of cheque fraud, counterfeit cheques, forged cheques and fraudulently

altered cheques, the biggest losses come from forged and altered cheques, totalling £20.3 million in 2013.

A forged cheque is a genuine cheque that has been stolen and used with a forged signature, while an altered cheque is a cheque that started off genuine, but is then altered in some way – for example the amount or name.

The Cheque & Credit Clearing Company (C&CCC) has shared some on advice for organisations and charities to help prevent them being a victim of this kind of cheque fraud, such as:

  • Drawing a line through all unused space after both the payee name and the amount
  • Making sure cheques aren’t visible through window envelopes
  • Leaving as little space as possible between words when filling in a cheque
  • Checking your bank statements regularly for unfamiliar transactions.

C&CCC are also tackling fraud at an industry level, with a number of measures in place to protect against fraud. One of these is the Cheque Printer Accreditation Scheme, which we are a part of. This requires all companies offering cheque printing to adhere to strict quality and security standards.

As one of the UK’s largest providers of C&CCC Standard 3 pre-printed cheques and cheque books we’re pleased to say that as a result of these measures, counterfeit cheque fraud dropped by 41% in 2013, only accounting for £7.2 million of fraudulently used cheques.