In 2023, $21 billion, or 80%, of global check fraud took place in the Americas, primarily the U.S. As fraud scenarios such as counterfeit, washed and altered checks grow increasingly prevalent, financial institutions need to identify and implement innovative solutions to help solve these complex problems.
Check Fraud: Shifting Focus to the Back of the Check
When altering or counterfeiting checks, criminals will spend much of their time focused on the front of a check – often replicating it with a high degree of accuracy. This is due to fraudsters understanding that much of the scrutiny by financial institutions and fraud investigators will be focused on the front of the check examining border security features, signatures, physical organization and layout, and text/font differential.
Many financial crime management approaches do not have the capability to examine the back of a check, which contains critical security features and patterns. By incorporating information from the back of a check into their fraud investigation, investigators have another valuable opportunity to identify inconsistencies and catch criminals committing check fraud.
Considerations for Financial Institutions When Choosing a Check Fraud Solution
Image analysis is one of the vital tools in the fight against check fraud. By leveraging advanced technologies such as Optical Character Recognition (OCR), image processing, and machine learning, that consider details on both the front and back of a check, financial institutions can significantly enhance their fraud detection capabilities.
When combined with a solution that also provides counterparty and behavioral analysis in the in-clearing process, institutions will be alerted to potential risk and thereby strengthen their fraud detection prevention processes.
Nasdaq Verafin’s Check Fraud Solution
Nasdaq Verafin’s behavioral and counterparty analysis, combined with our image analysis strategy that includes over 300 image-based features in its risk model, help investigators identify fraudulent check use. Our solution offers an array of tools to help expose the differences between suspicious checks and known good checks, including an embedded check viewer and Heat Maps, a tool that identifies structural differences between the check images.
Nasdaq Verafin provides financial institutions with a holistic check fraud solution that enhances detection for all check fraud typologies. Our check fraud solutionensures fewer false positives, superior detection and allows for an enhanced investigation within a single application. To learn more, check out our feature sheet or visit our new digital experience Stolen Checks: A Journey Interrupted.
