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Identity Theft Spotlight: Check Fraud

April 11, 2016

When was the last time you wrote or received a check? While credit card and debit transfers continue to increase, checks remain a common form of payment, especially for larger amounts. According to a 2013 Federal Reserve Payments Study, the number of checks paid in 2012 was 18.3 billion, and the average value of checks paid was $1,410. As long as checks are used, check fraud will continue to remain a concern for consumers. Check fraud is a particularly disruptive form of identity theft as it involves the money in a victim’s checking account. The below example illustrates one IDShield member’s experience with check fraud. Fake checks with real information Identity theft occurred when, unknown to Lindsey S.*, someone created checks that included her legitimate bank account information and her actual address. The perpetrator presented those checks to several retailers, who, not knowing that the checks were fake, accepted them for payment of the purchases the thief made. When she noticed the unauthorized debits in her checking account, she contacted her bank and learned that checks were created and were being used. She closed the checking account. This caused the checks that retailers accepted but had not yet been paid by her bank to be returned to the retailer. A licensed private investigator takes action Collection actions against her happened next. Some retailers outsource the collection process and others have their own in-house collection department. In all cases, a licensed private investigator took on the job of notifying all entities involved that Lindsey was a victim of check fraud and not the party who presented the checks. In addition to the collection companies and departments, Lindsey’s investigator worked with the associated consumer reporting agencies to ensure there would be no lasting negative impact. Until this action by the investigator took place, she would not have been able to present checks at retailers because the initial actions of the perpetrator reflected poorly on the record associated with the checking account information. Identity resolution with a pro-active approach As is normal procedure, a licensed private investigator took a pro-active approach to look for any yet-undiscovered identity theft issues. Fortunately for Lindsey, no other issues were found. The case was closed after a subsequent consumer report review proved that all issues created by the check fraud were resolved in her favor. Concerned about check fraud or other forms of identity theft? IDShield offers a robust identity theft protection service that instantly alerts customers to signs of trouble and proactively shuts out thieves. IDShield members rest easy in the knowledge their lives will be back to normal in no time. To learn more about IDShield, visit www.IDShield.com. *Name changed