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Check Fraud Prevention

Sunday 12 October 2003 13:55 CET | News

In 2003, TowerGroup estimates that check fraud will cost commercial banks $853 million-while these same banks will avoid losses of nearly another $4.5 billion by taking preventative measures (i.e. detecting and thus avoiding further frauds).

The US banking industry currently spends more than $280 million per year on these preventative measures, which equals a total cost to the industry of more than $1.1 billion per year in both losses and prevention. In recent years, the sophistication of scanners and color laser printers has made paper check fraud easier. Yet creating a fraudulent check image may be even easier than credibly faking a paper check. The wider adoption of check image presentment potentially opens up both new challenges and opportunities. While the availability of images will enable some automated controls not possible or practical today, such as automatic signature scanning, banks will no longer have the paper check itself to inspect. Certain types of common fraud prevention methods used today will no longer be usable. In TowerGroups new research titled, Catch Me If You Can (Again): Check Imaging Changes the Rules on Check Fraud, TowerGroup, examines the changes in fraud and its detection as imaging becomes more widespread, as well as new detection methods currently being introduced.


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Keywords: ,
Categories: Payments & Commerce | Payments General
Countries: World
This article is part of category

Payments & Commerce