Protecting Yourself Against Cheque Fraud The following article was recently published on the CIBC corporate website.  It identifies ways to protect business against cheque fraud.  BAASS can provide your clients with technology solutions to protect themselves against this growing problem. Cheque fraud is one of the fastest growing financial crimes today. Projections indicate that cheque fraud will grow by 25% each year. It's estimated that commercial fraud, including cheque fraud, costs North American business in excess of $20 billion CAD annually. Cheques remain the dominant form of payments in North America despite technological advances. Cheque defrauders are hardworking and creative. They constantly try new techniques to beat the banking system and steal money from depositors. There are three main types of cheque fraud: Counterfeit - cheques not written or authorized by legitimate account holder Forged - Stolen cheque not signed by account holder Altered - an item that has been properly issued by the account holder but has been intercepted and the payee and/or the amount of the item have been altered How can you protect yourself from fraud for items drawn on your account? Reduce the use of risk-prone cheques in favour of electronic payments such as wire payments, direct deposit and pre-authorized payments. Keep cheque stock in a secure location. Destroy unused cheques from closed accounts immediately. Checks and Balances - split responsibilities so that no one person is responsible for cheque issuance and reconciliation. Prompt account reconciliation - Reconcile your statements as soon as they are received. To speed things up, many clients see a significant advantage in products like: CIBC Business Banking, our Internet banking platform Positive Pay, which matches cheques presented against your own cheque issue files and identifies all exceptions for a Pay/No Pay decision Corporate Clearing, which helps large volume cheque issuers manage the daily processing and reporting of paid items When re-ordering cheques, use a continuous set of serial numbers. Order only one set of cheques per account. When laser-printing cheques, issue multiple passwords to those responsible for cheque printing and use cheque paper with toner anchorage to permanently bond toner ink into the paper. Use high quality cheques employing a reasonable mix of security features. Davis and Henderson meet all of CIBC's requirements for cheque printers. Report any old outstanding cheques and suspected fraud on your account immediately. If you have a concern about one of your client's current systems or controls, BAASS has a selection of solutions to protect them against fraud.  Please call Chuck Jerome for more details @ (866) 260-5302. This article is courtesy of the CIBC.  The information provided in this article represents general guidelines and could never substitute for a full analysis of your cheque issuing and electronic payment systems. Payments are an essential activity of every business and therefore require a strategy with a full set of policies and procedures. BDO Home Page