12 check fraud red flags every teller and cashier should know

The four kinds of check fraud

Before the red flags, it helps to know what you're looking for:

• Counterfeit checks are printed from scratch, often using a real company's name and logo with a routing/account number that is either fake or belongs to someone else.
• Altered (washed) checks are genuine checks — frequently stolen from the mail — where the payee or amount has been chemically removed and rewritten.
• Forged checks are genuine blank checks with a forged signature, typically from a stolen checkbook.
• Stolen legitimate checks are real and properly issued, but presented by someone who isn't the payee, usually with a fake or borrowed ID.

Mail theft has made washed and stolen checks the fastest-growing category. FinCEN's 2023 alert on mail-theft-related check fraud noted a surge in reports following the pandemic, and the volume has not returned to earlier levels.

Physical and printing red flags

1. Four clean-cut edges

Almost every genuine check has at least one perforated edge from being torn out of a checkbook or a business check run. A check with four smooth edges was cut from a sheet — typical of home printing. Not proof on its own (some business checks are laser-printed and trimmed), but a reason to look harder.

2. Missing or fake microprinting

Look at the signature line. On a genuine check it's a line of microscopic text that resolves under a loupe or phone camera zoom. On a copied or printed counterfeit it's a solid or dotted line. Many checks also have microprinted borders.

3. Glossy, raised or smudged MICR line

The routing and account numbers at the bottom are printed in magnetic ink using a specific MICR font (E-13B). Genuine MICR looks flat and slightly dull. Toner-printed MICR is often glossy and can smudge under a fingernail. Wrong spacing or a font that isn't quite E-13B is a strong signal.

4. Discolored or shiny patches near the payee or amount

Check washing uses solvents like acetone to remove ink. It leaves the paper slightly discolored, wavy, or shiny in that area, and the rewritten text is usually in a different pen or font from the rest of the check. Tilt the check under light; washing shows up as a dull halo around the altered field.

5. Numeric and written amounts that don't match

Under the UCC, the written (legal) amount governs if the two disagree, but fraudsters alter the numeric box because tellers read it first. Any mismatch, or a written amount squeezed into a space that looks too small for it, is a red flag.

6. A very low check number on a personal check

Personal checks numbered below roughly 200 indicate an account opened recently. New accounts are a favorite for fraud rings because they're opened with stolen identities and abandoned. Combine this with a large amount and no history with your business, and slow down.

7. Missing bank details or a bank address that doesn't exist

Genuine checks show the bank's name and usually a city/state. A check with no bank name, a bank you've never heard of, or an address you can't find is suspect — and all of it can be confirmed by validating the routing number.

Data red flags

8. Routing number that fails validation or names a different bank

This is the one red flag you can verify objectively in seconds. A routing number must pass the ABA checksum, exist in the FedACH directory, and belong to the bank printed on the check. Counterfeiters frequently print one bank's logo with another bank's routing number, or make up a number altogether. How routing number validation works →

9. Duplicate presentment

The same check — same routing, account and check number — showing up twice is either a mobile-deposit double-dip or a copied check. If your history says you've already seen this item, decline. This is very hard to catch by eye and easy for software.

10. Payee name that almost matches the ID

"Jon Smith" on the check, "John Smith" on the ID. Missing middle initials. A hyphenated surname with one half dropped. Stolen legitimate checks are cashed with real IDs that are close enough to pass a quick glance. Exact match or no match.

Behavioral red flags

11. Urgency and a story

"I need to catch a bus." "My landlord is waiting." "The bank is closed." Fraudsters know that verification takes time, so they manufacture a reason you shouldn't take it. A customer who gets agitated when you say you need to verify the check is telling you something.

12. Unusual amount or pattern for the customer

A regular who cashes a $600 payroll check every other Friday suddenly presents a $4,800 cashier's check from out of state. A first-time customer with a large check and a brand-new ID. Amounts just under your verification threshold. Patterns are red flags too.

Red flag quick reference

Turning red flags into a decision

Trained staff can catch most of these — on a slow day, with good lighting, when they're not on their 200th check. The problem is consistency. Check verification software applies the same checks to every item: OCR reads the fields, routing validation catches flags 7 and 8, image analysis scores 2 through 5, duplicate detection covers 9, ID matching covers 10, and the fraud score rolls it up into Approved, Review or Not Recommended. Your team spends its judgment on the "Review" pile instead of on every check.

Check EFI TeamWe build AI check and ACH verification software for check cashing stores, ACH originators and payment processors. Talk to us about your workflow.