Merck Employees FCU continues to warn members about the dangers of checks regularly, but on November 19, the Wall Street Journal article “We Can’t Give Up Paper Checks, and That’s a Gold Mine for Scammers” presents more details on the impact.
The article highlights the app “Telegram”, along with Facebook and TikTok, where scammers are posting banks and credit unions with more lenient check deposit holds. The fraudsters then alter checks and deposit them in these institutions, withdrawing the funds before the checks flow through the Federal Reserve system.
The article noted, “The scammers have found a particularly American security hole: our reliance on paper checks.” Thirty checks per person were written in the US in 2021, nearly twice as many as the French, the world’s second-biggest check users, according to the Federal Reserve.
Check fraud increased nearly 400% last year, according to a FinCEN report from September.
Due to lack of resources, unfortunately, local and federal agents are not able to investigate every check fraud case. Banks and credit unions continue to complete their own internal investigations and assist consumers, but the antiquated system continues to cause headaches for a large number of individuals.
To read the full article, visit https://www.wsj.com/finance/banking/paper-checks-fraud-scam-banks-9e4fb940?mod=Searchresults_pos1&page=1 (subscription required).
Merck Employees FCU will continue to discourage the use of personal checks and promote alternative options to members.
