d/b/a Metrol, (28) is an unpublished Arizona appellate court decision where the insured contended that the Employee Dishonesty coverage limits of $50,000 of Employees Mutual's policy applied to each of the 284 separate occasions of forged or altered checks occurring over a five year period totaling $584,000.
In June, 2002, the insured discovered that its employee had forged or altered checks on 284 occasions from 1997 to 2002.
For cancelled checks it could be handwritten check endorsements, multiple endorsements, unsigned checks, or altered checks
, Hall said.
It soon found that other stolen and altered checks
, as well as counterfeit checks, were being negotiated against the company's account.
Until now, Positive Pay has been the only weapon the industry has had to combat counterfeit and altered checks, but it does not identify alteration of payee names, and it has barely penetrated 10% of the banks' customer base," said Thomas G.
Carreker Corporation (Nasdaq:CANI), a leading provider of technology and consulting solutions for the financial industry, announced that it has formed an alliance with Advanced Software Design (ASD) Corporation, a provider of electronic check fraud prevention products to offer an integrated solution that enables financial institutions to provide significantly enhanced counterfeit and altered check detection capabilities to their corporate and middle-market business clients.
The court concluded, however, that Travelers would not he entitled to reimbursement of amounts mistakenly paid for the six altered checks
The best defense against altered checks
If there are any irregularities with the checks being presented for payment such as counterfeit, duplicate or altered checks
, the corporation is notified of the possible fraudulent document to determine how it should be handled.
The Office of the Comptroller of the Currency has identified the two most common forms of check fraud: altered checks
, where the payee or amount has been changed on what was a legitimate check, and counterfeit checks that look legitimate and are drawn on valid accounts but cashed by someone using fake identification.
This capability will speed up the decision to pay or not, and enable quick identification of fraudulently altered checks
The company's patented UV Smart(r) technology, introduced last year, is rapidly becoming the de facto standard for detecting counterfeit and altered checks