NCJ Number
164553
Journal
FBI Law Enforcement Bulletin Volume: 65 Issue: 8 Dated: (August 1996) Pages: 1-7
Date Published
1996
Length
7 pages
Annotation
The most prevalent problem in the U.S. banking industry involves check fraud, and the American Bankers Association indicates that the volume of check fraud against financial institutions increased by 136 percent between 1991 and 1993 and that dollar losses rose by 44 percent annually from $568 to $815 million.
Abstract
Major financial institutions in the United States attribute half of all check fraud to professional and organized efforts. In addition, large U.S. corporations cite check fraud and credit card fraud as their most problematic losses. New technologies give check fraud perpetrators a wide variety of schemes and devices for committing their offenses and make it difficult for law enforcement to combat the problem. Of 80 billion checks written annually worldwide, 60 billion are written in the United States. Principal ethnic enterprises involved in check fraud schemes include Nigerian, Asian (particularly Vietnamese), Russian, Armenian, and Mexican groups. Each of these groups usually conducts other white collar, drug, and violent crimes. Regardless of ethnic origin, groups involved in check fraud maintain certain universal characteristics. The groups usually have a loose organization and often network among several organizations. Leaders generally have extensive criminal histories and possess above-average intelligence. Check procurers obtain authentic checks, usually by stealing them while employed by a financial institution. Counterfeiters duplicate corporate and payroll checks, traveler's checks, credit cards, certified bank checks, money orders, and other negotiable instruments. Information brokers gather personal and financial information on legitimate individuals, and check passers actually negotiate stolen and counterfeit checks through the banking system and collect the proceeds to distribute to the group. Types of check fraud schemes are briefly described, and ways of identifying fraudulent checks are noted. The role of computer technology in facilitating check fraud, fraud prevention measures, and law enforcement successes against check fraud are discussed. 16 endnotes, 1 photograph, and 1 illustration