A Houston woman lost $24,000 to check washing, which is a technique used by fraudsters where they use chemicals like nail polish remover or bleach to remove the payee's name or amount from a stolen check to replace it with their own.

Jamie Forward had dropped a check into a US Postal Service collection box. However, the payment, which was meant for a retirement account, never reached its destination but was deposited into someone else's account.

While younger generations don't view checks as their primary payment option, nearly 50% of consumers still used checks in 2024, according to the US Federal Reserve.

Check usage has largely remained unchanged in recent years, butfinancial scams related to checksare on the rise. According to a CNN report, check fraud increased nationwide by an astronomical 385% since the pandemic, according to the US Treasury Department.

Now, fraudsters have devised a new technique called 'check cooking' to make multiple withdrawals from your accounts after getting access to your banking information or checks. Threat actors use the banking information to create multiple check copies that they can cash.

The main difference between check washing and check cooking is that the former is a physical process while the latter is completely digital. But how risky is check cooking really? Note thatfraudsters only need a photo of your checkto drain your bank accounts.

Georgia State University's David Maimon recently told a media outlet that criminals are increasingly using check cooking techniques to steal money. 'Cooking checks is essentially the criminal taking the original check, scanning the signatures, taking all the information, then using software to edit and print new checks,' Maimon explained.

The top way check cookers get information about victims is mail theft. Thieves can steal checks when you put a check in your mailbox and make copies before the check reaches its destination. A digital copy enables them to sell it to other fraudsters who make further copies in return.

In 2021, the Financial Crimes Enforcement Network received more than 350,000 suspicious activity reports about potential check fraud. Next year, the figure increased to over 680,000 in tandem with rising check-cooking fraud across the nation.

You could avoid falling victim to check cooking by using electronic forms of payments, especially when you have to send a check through mail.

Source: International Business Times UK