Checks

The special "Bank Code" printed on the bottom of all U.S. checks and ecommerce check drafts uses the MICR font.

Types:

• Personal checks. To avoid fraud:
  • Call the bank and verify the account and funds. Do not use the phone number from the check. Call 411.
  • Get the name of the bank employee who verified it.
  • Have them review with you all the security features and watermarks of the check to determine if it's real.
     
• Bank Draft or Casher's Check: These do NOT clear next day. The bank must make funds available the next day, but they can take up to two weeks to actually clear. If they fail to clear, the funds will be removed from your account by the bank at that time.
  • Most cashiers checks will have a perforated edge not a smooth one.
  • If possible, ask the buyer to meet you at the bank that issued the cashier's check and close the deal there. Ask the buyer to cash the check and then you deposit the cash at your bank. Be aware that if you cash the check and it turns out to have been fradulant, you just passed a bad check.
  • Call the bank and ask for a record of that check being issued. Do not use the phone number on the check. Call 411.

See:

• Bank Routing Number verification
• Positive Payments
• Checkbook Number, and Spell a Number for code to print an amount in english text
• Check Drafts

See also:

• http://www.bankinfo.com/training/anatomy.html Anatomy of a Check - Part 1
• http://www.bankinfo.com/training/anatomy2.html Anatomy of a Check - Part 2
• http://www.law.cornell.edu/ucc/3/overview.html UCC Article 3 (Negotiable Instruments)
• SCAN Corporation 1-800-262-7771 - clearing house scans entire face of the check, looks for changes in check face and flags check for review by human operator who accepts or declines the check. They will stop all activity on a checking account if they think a fraudulant check has been written.
• http://www.badcheckcollector.com/scan.htm
• http://www.micr-check.com/
• http://www.ckfraud.org/menu.html
• http://www.occ.treas.gov/chckfrd/contents.htm Check Fraud: A Guide to Avoiding Losses
• http://www.thelocalbbb.com/alerts/alerts.html?newsid=639&newstype=1 Better Business Buerau alert reguarding bank and casheres check fraud.
• http://www.utexas.edu/business/accounting/hbp/06_cash/cash3.html Handbook of Business Procedures, Check Collections
• http://www.abagnale.com Frank W. Abagnale: an authority on the subjects of forgery, embezzlement and secure documents. Developer of "supercheck.net" A book and movie are based on his experiences.
• http://www.wisbank.com/nr082797.htm
• http://www.orderprintersupplies.com/ MICR Toner, Printers, and check paper.
• http://www.checkrite.com/
• http://www.telecheck.com/about/Why_Telechk/whytele.htm
• http://sandeen.net/freecheck/ a PERL script that generates a PostScript print file (or a pdf file in the online version) that uses a GNU MICR TYPE1 font to print a check.
• http://www.cdnpay.ca/eng/rules/006.ENG.htm STANDARDS AND SPECIFICATIONS FOR MICR-ENCODED DOCUMENTS

Questions:

• http://blog.trustoncorp.com/2006/08/trivia_which_us.html Trivia: Which U.S. law protects you from check fraud? Answer: There is no specific U.S. federal law that limits your liability for check fraud. But, the Uniform Commercial Code (UCC) does address check fraud. Basically, if you exercise reasonable care, you have 30 days to contest a fraudulent transfer from your account.

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