Why mailing a paper check has become so risky
Criminals use chemicals to “wash” away the recipient's name and dollar amount, and then rewrite the paper check to themselves.
We’ve become so used to high-tech cybercrime that we may sometimes forget about the vulnerability of our mailboxes.
But an old-school, low-tech scam is surging and is more than enough reason to avoid or limit writing paper checks altogether. And the recent predicament faced by a California couple who reached out to me shows how challenging it can be to retrieve money after a check’s been altered.
According to a joint warning from the FBI and the U.S. Postal Service, check fraud is skyrocketing. Federal data shows that reports of check fraud nearly doubled from 350,000 in 2021 to 680,000 in 2022.
It’s gotten so bad that the agencies recommend considering e-checks, ACH automatic payments and other electronic or mobile payments.
In 2010, there were just over 2,200 high-volume mail theft attacks, and by 2023, that number had skyrocketed to over 49,000, a “2,000 percent explosion,” Frank Albergo, president of the Postal Police Officers Association, said last summer during testimony before a House subcommittee.
“This is not about lost birthday cards anymore,” Albergo said. “We’ve entered an era of organized postal crime.”
Criminals use everyday household chemicals like acetone or bleach to “wash” away the payee’s name and dollar amount, allowing them to rewrite the paper check to themselves.
The California couple recently learned this the hard way after getting a notice from the Internal Revenue Service that they had missed their quarterly tax payment and now owed $12,000 plus interest and penalties.
The couple, who spoke on the condition of anonymity to protect their privacy, were shocked and puzzled. They knew they had paid on time.
“We looked at our online Chase statement, and the check had cleared,” the wife said in an email.
But when they pulled up the scanned image of the cleared paper check, they saw that someone had changed the “pay to the order line,” erasing the IRS as the recipient and replacing it with an individual’s name.
This isn’t limited to personal checkbooks. Fraudsters are going after business payments, tax refunds, and paper checks related to government assistance programs, such as Social Security and unemployment benefits, according to the Financial Crimes Enforcement Network.
If your government tax refund is stolen and cashed, there’s a process for reporting the theft. However, recovering from a stolen personal paper check can be much harder.
Once they realized what had happened, the California couple contacted Chase. But they were told they had missed the deadline to report the fraud. The paper check had been stolen and deposited a year earlier.
Still, they persisted and found that the paper check had been deposited by another Chase customer.
“We feel the bank was negligent in this transaction and owes us reimbursement,” the wife said. “I feel we could make a good argument, 60 days or not.”
They reached out to ask if I could help.
Chase’s initial refusal was technically legal. The deadlines for reporting and recovering funds are primarily governed by your bank’s deposit agreement and the Uniform Commercial Code. If you miss the window, the liability usually falls on you.
However, given how pervasive fraud is, financial institutions should do whatever they can to do the right thing, even when they aren’t in the wrong.
After I inquired about the case, Chase reinvestigated the situation. The bank was able to trace the fraudulent account to which the stolen money had been routed. It turned out there was still about $11,000 sitting in that account, enough to almost entirely reimburse the victimized couple.
This couple was incredibly fortunate. Most of the time, the money is long gone before a customer or bank discovers the scam.
“We’re pleased we were able to resolve this matter,” Chase spokesman Jerry Dubrowski said in an email.
It was a win for this couple, but a warning for the rest of us.
“We encourage customers to avoid mailing paper checks and to use safer payment methods, such as electronic transactions,” Dubrowski said. “If a customer must use a paper check, they should review their monthly statements to ensure payments are properly recorded.”
The primary reason that washed paper checks clear successfully is that modern bank processing relies heavily on automation and speed.
Unless a check is manually inspected for evidence of tampering — such as chemical staining, discoloration, or a mismatch between the signature’s handwriting and the payee line — a fraudulent paper check can clear, and the funds will be transferred directly to the thief.
Related: Do you value your time?
If you still choose to write a paper check, the FBI and the Postal Service offer these tips.
Protect your mail
Get your mail as soon as you can. Definitely don’t let it sit in your mailbox overnight. And avoid leaving outgoing mail in unattended home mailboxes with the red flag up. Use the Postal Service hold mail service if you are heading out of town. Buy security envelopes so thieves can’t see there’s a check inside. Go inside the post office to drop off outgoing mail. If you absolutely must use an outdoor blue box, don’t deposit a check after the day’s final pickup time. Protect your check Write paper checks with permanent, indelible black gel ink. Standard ballpoint pen ink washes off easily; gel ink traps itself in the paper fibers. Don’t leave blank gaps on the payee or dollar amount lines where a thief can sneak in extra words or numbers. Don’t just check your bank balance online. Look at the actual digital image of your cleared paper checks to confirm the payee’s name wasn’t altered. Check your online banking activity frequently. Verify everything about it. If a check you wrote is taking longer than usual to clear, or if you spot any missing funds, contact your bank immediately. Order paper checks with security features, such as microprinting, watermarks, or chemically reactive paper that bleeds when exposed to bleach or acetone.
It’s unfortunate we have to become forensic investigators just to pay our bills. But as criminals continue to exploit old-school vulnerabilities, we must be overzealous in protecting ourselves.
Article by Michelle Singletary
Washington, D.C. Personal finance columnist Michelle Singletary writes the nationally syndicated personal finance column “The Color of Money,” which appears in The Washington Post on Wednesdays and Sundays. If you have a personal finance question for Singletary, please call 1-855-ASK-POST (1-855-275-7678). Her award-winning column is syndicated by The Washington Post News Service and Syndicate and is carried in dozens of newspapers nationwide. In 2021, she won the Gerald Loeb award for commentary. She has written four personal finance books, including “What to Do With Your Money When Crisis Hits: A Survival Guide” and “The 21-Day Financial Fast: Your Path to Financial Peace and Freedom.” Singletary was the financial expert for “The Revolution,” an ABC daytime program. For two years, she hosted her own national television program, “Singletary Says,” on TV One. She is a frequent contributor to NPR programs and has appeared on national talk shows and television networks, including CNN, PBS, NBC’s “Today” and “The Early Show on CBS.” In her spare time, Singletary is the director of a ministry she founded at her church, where women and men volunteer to mentor others facing financial challenges. As part of this ministry, she and her husband also volunteer to teach financial literacy to prison inmates. She is a graduate of the University of Maryland at College Park. She has received the Distinguished Alumni Award from Johns Hopkins University, where she earned a master’s degree in business and management. In 2020, The Washington Post celebrated her long and distinguished career at the paper with the Eugene Meyer Award, its highest journalistic honor. To stay informed about various money issues, subscribe to her weekly retirement and personal finance newsletter, which will be delivered to your inbox every Monday and Thursday. Honors and Awards: Gerald Loeb Award, Commentary, 2021; National Association of Black Journalist Salute to Excellence Award, Commentary, 2021; The Washington Post Eugene Meyer Award, the paper's highest journalistic honor, 2020; Distinguished Achievement Award from the Society for Advancing Business Editing and Writing, the organization’s highest honor, 2019; Hall of Fame for the Society of Professional Journalists Washington, D.C., Pro Chapter, 2019; Fellowship, Wharton School of the University of Pennsylvania, Wharton Seminars for Business Journalist, awarded by National Press Foundation, 2018; Salute to Excellence Award for Community Service, National Association of Black Journalists, 2010; Best in Business, series of columns, Society of American Business Editors, 2008
Professional Affiliations: National Association of Black Journalists
Books by Michelle Singletary:
What To Do With Your Money When Crisis Hits: A Survival Guide
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The 21 Day Financial Fast: Your Path to Financial Peace and Freedom
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Your Money and Your Man: How You and Prince Charming Can Spend Well and Live Rich
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Spend Well, Live Rich: How to Get What You Want with the Money You Have
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Education: University of Maryland; Johns Hopkins University