By tf-lawyer.com In recent years, we’ve seen a dramatic rise in check fraud methods, revealing the versatile tactics criminals employ. One striking case involves Phi Dang, a businesswoman from Southern California, who became a victim of a sophisticated check scam. Thieves intercepted one of her checks in the mail and manipulated it using advanced techniques to change the payee’s name. Unfortunately, because she failed to report the fraud within the designated period set by her bank, she ended up losing over $10,000.
Dang runs a family-owned business that supplies small appliances to various retailers. She became alarmed when a supplier reached out about an unpaid bill. “I had already sent a check for $14,000, and the funds had been deducted from my account,” she recounted. However, she soon realized that the payee’s name on the check had been tampered with.
Phi speculated that the thief had stolen the check, used a chemical agent to alter the payee’s name, and then cashed the modified check at a bank. “I was really nervous because this is a significant amount of money,” she shared. Upon discovering the fraud, she immediately contacted her bank, Wells Fargo, to report the incident. To her dismay, Wells Fargo informed her that because she didn’t report the fraud within 30 days, she would not be able to recover her lost funds. The bank issued a statement expressing sympathy for her situation, but highlighted the importance of customers submitting claims for suspected fraudulent transactions promptly.
In a similarly distressing situation, Celine, another local resident, described how she sent out a check for several thousand dollars, only to have it stolen and altered by fraudsters, leading to a loss of $16,000 from her account.
Data from the U.S. Department of the Treasury indicates that check fraud cases have surged by 365% since the onset of the pandemic, with many banks struggling to provide effective solutions for affected customers.
Carola Sanchez-Adams, a senior attorney at the National Consumer Law Center, shed light on the issue, noting that many consumers often realize they’ve fallen victim to check fraud only after it’s too late. “Under the Uniform Commercial Code (UCC), victims are expected to notify their banks within one year,” she explained. “However, many banks enforce a much tighter window of just 30 days in their account agreements.”
To help mitigate the risk of check fraud, experts recommend several key strategies: delivering checks in person to payees whenever possible, regularly reviewing bank account statements, and carefully inspecting images of cashed checks to ensure that neither the payee’s name nor the amount has been altered.
