Pub. 1 2012 Issue 7

check drawn on an actual company’s account. It may be a check drawn on a Canadian bank. It may be a properly issued check which was stolen from the mail, chemically washed to remove the original payee and altered to show the victim as payee. How does the crook get the money? The crook convinces the victim to send part of the check proceeds to an accomplice as soon as the bank will allow the customer to withdraw the funds. The reason given for sending the money varies. It could be a percentage was agreed to be paid as part of the “deal.” Funds may need to be paid to release additional funds. Funds may need to be paid for alleged taxes, licenses, fees or attorney fees for the deal. The amount of the check may be more than what was owed so a portion of the funds need to be returned. The customer may be told that a foreign company needs an agent to cash a check in the U.S. and then wire the funds. The stories are sometimes very believable. W ITH THE INCREASEDUSEOF THE INTERNET and e-mail, there are a growing number of ways in which good, well-known bank customers are be- ing scammed. These scams vary in size from a few hundred dollars to hundreds of thousands of dollars stolen from a single customer. There are many stories used in these scams; they are too numerous to list. The scams all have two things in common. First, the scams involve convincing the good bank customer that the stranger is “trusting” the victimwith his funds. The crook wants the victim to be in a position to “prove” he can be trusted. Second, a check of some sort is sent to be deposited to the victim’s account. The check names the good bank customer as the payee. When the victim is a longtime, well- known customer of the bank, it is not likely that the bank will refuse to accept deposit of the check. The check may be drawn on an account of a large, well-known company; it may appear to be a U.S. government check; it may appear to be a cashier’s check. However, in every case, the check is not valid. It may be a completely fictitious check drawn on a nonexistent entity at a nonexistent bank. It may be a fictitiously created 12 l e a d i n g a d v o c a t e f o r t h e b a n k i n g i n d u s t r y i n k a n s a s continued on page 14 SECURITY OFFICER’S BY-WORD WHEN IS A CHECK “GOOD?” WHAT EVERY BANK CUSTOMER SHOULD KNOW Charles M. Towle, Senior Vice President, Kansas Bankers Surety Company