Mitigate Check Fraud

Real-Time Detection Solution Mitigates Check Fraud

Posted: Jan 26, 2024 | Author: Jordan Sudberry, Catalyst Corporate FCU
Catalyst Corporate FCU  check fraud  TrueChecks 

In 2022 alone, financial institutions issued 680,000 reports of check fraud to the Financial Crimes Enforcement Network – an increase of 94% over the previous year. Lacking adequate security and detection controls can lead to significant financial loss.

How can credit unions protect themselves against check fraud? Understanding the importance of detecting fraud in real-time is beneficial.

What is the value of real-time detection? 

Check fraud is the process of cashing stolen or counterfeit checks to steal funds directly from a victim’s account. It’s often committed on a larger scale by sophisticated criminal-run operations. As years have progressed, these fraudsters have transformed into highly organized perpetrators, causing significant losses to financial institutions.

Check fraud is magnified during the holiday season, and fraudsters try to find the weakest entry point, hence the need for a solution to minimize the risk of financial losses. Furthermore, these advanced schemes rely on the extended processing window and slower fraud detection techniques to withdraw victim funds successfully. Real-time point-of-deposit detection minimizes these challenges by alerting credit unions instantly and allowing them to take immediate action. Faster intel equals better protection of your members’ funds.

How does check fraud directly affect credit unions?

As you know, credit unions that accept fraudulent checks may be responsible for reimbursing account holders who become victims of check fraud. With incidents on the rise, so are losses incurred by credit unions.

In addition to financial losses, check fraud can also generate negative publicity, which can be detrimental to a credit union’s success.

Until checks disappear entirely, it’s beneficial for credit unions to invest in proactive measures to protect themselves and their members against check fraud.

A solution to detect check fraud

Credit unions can protect themselves against financial loss by integrating a real-time detection solution that alerts tellers and back-office staff of possible risks associated with check deposits.

Catalyst Corporate teamed up with Advanced Fraud Solutions to bring you TrueChecks®, a real-time check fraud detection solution that can save credit unions from potentially significant losses every day.

TrueChecks sends messages with corresponding green, yellow, and red light alerts to guide tellers and back-office staff to accept, place a hold, or deny items. An inquiry on a deposit item may generate one of 27 possible responses to warn of potential NSF, closed accounts, duplicates, counterfeits, etc. 

In addition to detecting fraud, implementing TrueChecks helps credit unions demonstrate their investment in safeguarding member accounts against the growing threat of check fraud.

To protect your credit union against check fraud loss – in real-time – look to Catalyst’s premium check fraud detection solution, AFS TrueChecks. For more information, contact us today.

Jordan is responsible for developing relationships with credit unions and facilitating the sale of Catalyst’s correspondent, payment, and technology services. He also represents Catalyst at area credit union events. Jordan gained experience in the community banking segment, working for Fitech Payments, representing and implementing their payment processing services.


Sign up to the receive Cornerstone Resources blog notifications.

Need Solutions?

Cornerstone Resources offers a wide variety of products and services tailored to credit union interests.