How to Protect Yourself from Check Washing Schemes
By Tammie Smeltz, RPLU, Content Marketing Manager
A couple of months ago, MLMIC contacted one of our insureds regarding a past-due payment. Our insured advised that he had, in fact, forwarded a check in payment of his premium. However, when he reviewed the transactions on his checking account, he noticed his check was altered and cashed by someone other than MLMIC. The insured was a victim of check washing.
What is Check Washing?
Check washing occurs when someone steals checks from the mail and “washes” away the payee and amount. The check owner’s signature remains on the check, making it a blank check. Thieves either steal checks by tampering with collection boxes or robbing postal workers. Once a check is stolen, it can be sold or the thief can make the check payable to themselves, which is what occurred with our insured.
Check washing is considered fraud and it is not a new scheme. Criminals charged with check washing face a number of penalties, including fines and, in some circumstances, incarceration.
How to Protect Yourself from Check Washing
There are many ways to protect yourself from check washing. Let’s look at a few:
- If you are a MLMIC insured and have been paying your premiums by check, consider using our online portal for your payments. MLMIC accepts credit card payments with no additional charge to insureds. Access your portal here.
- Use a black gel pen. Experts agree that black gel pens are harder to wash. Some companies even claim that the ink in their gel pens is not washable.
- If you are sending a check in the mail, think about personally delivering your payment to the post office.
- Make sure to retrieve your mail daily and, if you are going out of town, request a USPS mail hold.
- Lastly, monitor your bank accounts regularly for suspicious activity and immediately report any activity to your banking institution. If the check has not been cashed, the bank may be able to put a hold on it. If the check has already been cashed, the bank may file a police report and, in many circumstances, will cover your lost funds.
By understanding the tactics used by check washers and taking preventative measures, you can protect your business and personal finances.
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This document is for general purposes only and should not be construed as medical or legal advice. This document is not comprehensive and does not cover all possible factual circumstances. Because the facts applicable to your situation may vary, or the laws applicable in your jurisdiction may differ, please contact your attorney or other professional advisors for any questions related to legal, medical or professional obligations, the applicable state or federal laws or other professional questions.
