Nearly anyone can inadvertently write one bad check for insufficient funds, but doing it intentionally on a repeat basis constitutes check fraud. Also known as paperhanging, this type of crime is joined by a handful of other check fraud classifications.
According to a report by the American Bankers Association (ABA), total check fraud attempts have reached a new all-time high in value: $15.8 billion in 2018 compared to just $8.5 billion in 2016. The ABA continued by saying that the financial loss from successful check fraud attempts rose from $789 million in 2016 to $1.3 billion in 2018.
The ABA also said check fraud has been on the rise over the last 30 years due to digital channels. Is there a silver lining to this dark cloud? The answer is that U.S. banks prevent over 90% of check fraud attempts via early detection methods.
- Types of Check Fraud
- Check Fraud in Relation to the History of Checks
- What Are the Penalties for Check Fraud?
- In Closing