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Join KeyBank experts and guests as we discuss the latest fraud threats and cybersecurity trends. We’ll cover rising scams and fraud tactics in detail. We’ll also provide steps you can take to help protect your accounts and personal information so you can avoid becoming victim.
[00:00:04] Kolt: Hello and welcome to the Key Talks Fraud podcast. In each episode, we bring on experts to talk about fraud trends, emerging threats, and steps you can take to help protect your financial accounts. We’re glad you’ve joined us today. Let’s get started.
[00:00:16] Kolt: By way of introduction, my name is Kolt. I’m the head of enterprise fraud services here at Key. On this podcast, we talk about fraud in a very real, practical way — what’s actually happening, how people get caught up in it, and what you can do to protect yourself. Today we’re going to talk about check fraud, and it might surprise some people because checks seem so old school, but check fraud is one of the most pervasive frauds that we see. I’m joined today by Stacie. Stacie leads our fraud solutions team here at KeyBank and spends every day thinking about how fraudsters and criminals are trying to exploit our clients in the financial services system. So Stacie, thanks for being here.
[00:00:51] Stacie: Yeah, thanks, Kolt. I’m really glad we’re talking about checks today because check fraud really catches people off guard when it does occur.
[00:00:59] Kolt: So let’s talk about this. Let’s just start with the basics. What is check fraud?
[00:01:03] Stacie: Well, at its simplest, Kolt, check fraud is really when either a physical check is stolen in the mail, or the information on a check is stolen — so your account information — and then the criminals use those items to obtain money that doesn’t belong to them. Again, it could be stealing a physical check; it could just be getting the information that’s on your check — your account number, whatever method they deem as the best, most practical way to steal your information. They’re going to use it, create checks, and take your money.
[00:01:42] Kolt: All right, so I’m pretty savvy. I know that fraudsters steal your mail out of your mailbox, and I don’t do that anymore. I take it to the post office. I’m safe that way, right?
[00:01:50] Stacie: Whoa, no — so it sounds like you’re going to be safe, but in actuality, there are lots of ways that checks can be compromised. If you drop it in the blue box — not safe. Criminals can fish it out. It’s like taking a fishing pole and fishing it out of the blue box. So the residential mailboxes are not safe, and the blue collection boxes are not safe either. They can steal the arrow keys.
[00:02:18] Kolt: I was going to ask you that. What if I take it into the post office branch — am I safe there?
[00:02:22] Stacie: No, not even into the postal branch — you’re not safe there because criminals have actually been targeting the arrow keys that postal service workers carry. Those keys open lots of different boxes, which allows them to steal lots of envelopes that hopefully — for them — contain their number one target: a handwritten check from you or me.
[00:02:45] Kolt: All right, so let’s talk about this. A check is not like other payment types like a debit card or a credit card that has just an account number. There are other really useful things that fraudsters can get off of that check.
[00:02:58] Stacie: Absolutely. They’re going to get your account number and your routing number for your bank, which is like gold. But you also have your name, your address, and your signature — so they can copy and counterfeit your signature. And some people put things like their phone number on checks so they don’t have to write it out when they write a check at their local grocery store. Back 20 years ago, Kolt, people were even putting their Social Security numbers on checks. Luckily we’ve come a long way, but everything a fraudster needs to perpetrate fraud is right there on that check.
[00:03:38] Kolt: And it seems so low-tech, right? But there’s a lot of information on there. It’s actually one of the most information-exposing payment methods out there, for all the things you just talked about. All right, so we’ve touched on writing checks — let’s talk a little bit about receiving checks. If I get a check, am I safe? Is there any risk in receiving one? Say I sold my mountain bike for $2,100 and someone sent me a check for $2,500 for shipping and handling — is there something I should be looking out for when I receive a check like that?
[00:04:12] Stacie: Yeah, absolutely. Those instances where you receive more money than what you were owed are typically what we call overpayment scams. What they want you to do is deposit that check, take the money, and send back the overpayment to the fraudster. And by the time you’ve sent that money out the door, guess what happens, Kolt — that check bounces. It doesn’t actually pay.
[00:04:42] Kolt: So explain that to me. If I deposit a check into my bank and they make the funds available, the check’s cleared, right? The funds are good.
[00:04:48] Stacie: No, absolutely not. That is not an indicator that a check has cleared, because checks really never “clear” in real time. A check clears when it is returned — or not returned. When a check goes bad, that’s when you know it’s bad. You cannot assume that because the money landed in your account that the check has actually paid in full.
[00:05:13] Kolt: This is a really important point, and I want to spend a little time on it. If you do get a check like that, deposit it, and then send money back — you are liable for what you’ve put into your account. One of the best things you can do, if the check is drawn off of another bank, is to actually take that check and cash it at the issuing bank. Let them know what happened; be forthcoming with them so it doesn’t look like you’re trying to pass a bad check. That’s a good way to secure the funds and make sure you’ve got them before you send merchandise, a car, or anything else. We actually had one recently where someone bought a car, the seller sent the car, and they never heard from the buyer again. So you can absolutely become a victim on the deposit side as well. Key lesson: funds being available does not mean the check is good.
[00:06:00] Kolt: Try to use other payment methods besides checks.
[00:06:03] Stacie: Well, Kolt, I think we need to be really direct here. People need to stop writing checks. While checks are one of the easiest payment methods to use, they’re also one of the easiest for criminals to exploit. Every time you write a check, all of your information is sitting out there for fraudsters to have at their disposal. The best thing we can do is really move from paper checks to digital payments — going through your online banking platform and using the digital payment options instead of keeping a paper checkbook around. I know it’s a shift for a lot of people, but it’s the safest way to protect your data, your information, and your bank accounts.
[00:06:55] Kolt: Yeah, the real truth is that those are more modern payment types than checks, which have been around forever — and they come with a lot more security built in. Great advice. Listen, this is a tough one. I struggle with it with my mom — she sends checks in the mail for the grandkids’ birthdays and Christmas, and I’ve really had to talk to her about the risks. While it might feel more tangible, an electronic payment is the preferred method for us now. So as we’ve talked about this: avoid public mailboxes, don’t put the “come steal me” flag up in your mailbox, secure any blank checks, and
[00:07:30] Kolt: whenever you write checks, don’t leave any blank space — fill it all in so that dollar amounts can’t be manipulated.
[00:07:36] Stacie: There are also certain pen types worth mentioning, Kolt. You can Google it, but there are specific pens that are resistant to washing. Some pens allow the ink on a check to be washed off quite easily, but others are much more durable. Do a little bit of homework and find a pen that holds up well on paper.
[00:08:00] Kolt: And I’ll say this — it sounds so simple, but we say it all the time: monitor your accounts. Whenever a check you’ve written posts to your account, actually review it. Make sure the payee hasn’t been altered. Make sure the dollar amount hasn’t been altered. You have limited windows to initiate a claim on that. So don’t just see “Check 1234 cleared” and assume it made it to the right area. If it gets stolen and someone else deposits it, they could have changed the payee and the amount. Monitor your accounts and look at those checks as they come through. Absolutely. So Stacie, if someone has become a victim of fraud, what should they do?
[00:08:45] Stacie: You need to act quickly, Kolt. Immediately report it to your bank. You can usually do that through the phone channel — the 1-800 number on the back of your debit card. You can go directly into your branch, or you can also file a claim through the online banking portal.
[00:08:56] Kolt: The faster you can do it —
[00:08:59] Stacie: The faster you can do it, the better.
[00:09:01] Kolt: — the more options you have for recovery. So if you’re a KeyBank client, you can always call our Fraud Client Service Center at 1-800-433-0124. If you use TTY or TRS, you can dial 711. So Stacie, as we wrap up, any final thoughts on check fraud?
[00:09:20] Stacie: You know, fraud is incredibly pervasive, and criminals are going to adapt — and they’re going to adapt quickly. But I do think check fraud is one that will never go away. We’ve been saying for the 26 years I’ve been in banking that checks are going to go away, but they never go away. It’s a great example of how fraudsters shift from the latest new things and go back to the old “reliable” method that’s always been there. They’ve come back to check fraud, and it’s more important than ever that we do everything we can to just get checks out of the marketplace and away from the fraudsters.
[00:10:05] Kolt: Fraud education and prevention is very important. If you’re listening to this podcast, do me a favor — find two other people that you know and talk to them. Make sure they understand the risks of writing checks and what they can do to reduce that risk and prevent fraud. Whether you’re a KeyBank client or not, you can always visit key.com/fraud. There’s a lot of helpful information, tips, and resources available to everyone.
[00:10:25] Kolt: And that’s going to wrap us up for today. Thank you for joining us. As a reminder, this content is for informational purposes only. It is not financial, legal, or investment advice. For guidance specific to your situation, please consult a qualified professional. We look forward to you joining us next time on Key Talks Fraud.