Resources on Check Fraud

Check fraud continues to be a pressing issue for financial institutions. In fact, FinCEN reported that financial institutions reported 680,000 suspicious activity reports for possible check fraud in 2022 which was a significant increase over the prior year. In light of this, the Federal Reserve recently issued a Compliance Spotlight to help remind institutions of the various resources available to help them respond appropriately to check fraud. These include:

  • In 2018, the Federal Reserve published an article in their Consumer Compliance Outlook on Responding to Counterfeit Instrument Scams, which includes some tips on how to mitigate risks. The Federal Reserve also noted that financial institutions can report concerns about check fraud and other issues through its Contact Us.

  • FinCEN issued an Alert in February 2023 (FIN-2023-Alert003) urging institutions to be on watch for and to report such activity. It also encouraged institutions to share information under Section 314(b) of The USA PATRIOT Act.

  • The United States Postal Inspection Service (USPIS) is also involved in trying to reduce check fraud. It has published Tips & Prevention as well an Information page and a brochure that can be provided for customer education.

  • Institutions are able to access a Check Fraud Claim Directory through the American Bankers Association(ABA), regardless of whether the institution is an ABA member or not. This database includes contact information for filing warranty breach claims with various financial institutions.

  • Institutions are also encouraged to see if their check service providers have additional fraud prevention products and services.

Consulting Resources!

Published
2024/04/12

Amy Kudlacek

Amy brings many years of banking and compliance experience to Banker’s Compliance Consulting. She has worked for both large and small financial institutions and spent time working in every area of a bank. She started out as a teller in college and eventually became a branch manager. Her love, however, was always compliance. Amy began her career with Banker’s Compliance Consulting in 2000. Her knowledge and experiences have allowed her to develop a well-rounded and practical approach to regulatory compliance. Amy is CRCM certified, has a Bachelors Degree in Business Administration and is a graduate of the ABA Compliance School. Amy & her husband have two children at home and stay busy following their activities. They spend a lot of time in the bleachers!

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