Cheque Fraud

There are many different types of cheque fraud. Cheques are either manufactured/cloned, altered/amended, stolen, or forged. Learn how cheque fraud works and how to avoid it.
 

An eye for details

Be aware of the different types of fraudulent cheque activities. 
 

• Manufactured/Cloned cheques are created for the purpose of committing fraud. A cloned cheque is often an exact replica of the original, even down to the cheque number. Although they appear to be legitimate, a closer look at the details (like signatures and drawer details) reveals the fraud beneath.
• Altered/Amended cheques are legitimately issued by the registered accountholder, but a fraudster will intercept the cheque and make changes like -
  
  
  • creating a new payee name; 
  • adjusting the payee name, eg 'Edgars' is changed to 'WEdgars Smith', or 'One' is changed to 'Two' with pen strokes; and 
  • adjusting the value of the cheque

While all the original information remains on the cheque, it has been altered. Also, these changes are often disguised beneath a 'Not transferable/Not negotiable' stamp.
 

• Stolen cheques are genuinely issued by the registered accountholder but stolen and fraudulently cashed. Fraudsters tend to steal cheques in the post, proceeding to pay the cheque into a fraudulently opened account in the payee's name.
• Forged cheques come about when a legitimate cheque or chequebook is stolen or lost. The fraudster then completes the cheque and signs it on behalf of the drawer. The signature is always forged and it may or may not resemble the legitimate signature specimens.

Tips to avoid cheque fraud
 

• When you accept a cheque as a means of payment:
   
  • ensure the handwriting is consistent; 
  • check for any spelling mistakes on the cheque's printed areas;
  • ensure that any stamps aren't concealing alterations;
  • ensure the same pen was used when completing the cheque; 
  • check for any visible alterations;
  • be aware of negative printing, ie white lettering used on a background to conceal unauthorised changes; and 
  • ensure funds are cleared before you release goods.
     
• Write the payee details in full, leaving no space in front or after the payee's name.
• Write the amount in figures close to the R (rand) sign to avoid extra figures being added.
• Cancel any unused space by drawing lines.
• Make sure you use the correct markings on a cheque. When you cross a cheque, or mark it 'Not transferable', that cheque can only be accepted in an account with the payee's name. However, if marked 'Not negotiable' this can be endorsed on the back by the original payee and transferred to someone else.
• Never sign a blank cheque, and avoid issuing cash cheques.
• Avoid posting cheques. Rather transfer funds electronically.
• Keep your chequebook under lock and key and report any lost cheques to the Nedbank Contact Centre on 0860 555 111.