Guide to Altered Checks and How to Spot One

By Jacqueline DeMarco · July 12, 2022 · 7 minute read

We’re here to help! First and foremost, SoFi Learn strives to be a beneficial resource to you as you navigate your financial journey. Read more We develop content that covers a variety of financial topics. Sometimes, that content may include information about products, features, or services that SoFi does not provide. We aim to break down complicated concepts, loop you in on the latest trends, and keep you up-to-date on the stuff you can use to help get your money right. Read less

Guide to Altered Checks and How to Spot One

Check fraud, financially damaging to its victims, has been going on for decades.

Here’s how it happens: When a check is altered (most commonly the payment amount or recipient name), this is a form of check fraud.

Keep reading to find out what constitutes an altered check and how to spot it.

What Is an Altered Check?

What is considered an altered check? It’s a normal paper check that was altered fraudulently. Essentially, if someone writes a check and another person changes the amount on the check (usually by adding an extra zero at the end of the check amount or by changing the payee’s name) in order to commit fraud, this is considered an altered check.

The payer or payee who was defrauded needs to report this fraud within a year to help ensure the loss will be covered. If a bank has reason to believe a check has been altered fraudulently, it can legally refuse to cash it.

The Office of the Comptroller of the Currency (OCC) advises not leaving large spaces in the number and amount lines when writing a check to help avoid fraudulent alterations from occurring.

Altered checks are one of the most common types of check fraud. Other types include forgeries, counterfeit checks, and remote checks (this is when there is a false statement that says the account holder authorized a check in lieu of their signature).

Who is liable when a bank finds an altered check? According to the Uniform Commercial Code (UCC) — which addresses altered checks in Section 3-407 — the liability can affect multiple parties, including:

•   The check writer

•   The check cashier

•   The bank that presents the check

•   The bank that verifies and cashes the check

It’s not always easy to know when a check is good.

To help soften the blow of altered check fraud, consumers can benefit greatly from examining their bank statements after they write a check to ensure the right amount is processed.

If you do find evidence of an altered check, you should ideally report the loss within 30 days, but you have to do so within one year if you want to be reimbursed for the loss.

Recommended: How to sign over a check to someone else.

Example of an Altered Check

Not sure what an altered check looks like? Let’s review an example of an altered check to make it easier to learn how to spot one.

Let’s say a check is made out to a dollar amount of $1,000. Look closely at that payment amount. Ask yourself these questions:

•   Does the last zero look like the same type of ink was used to write it and was written in the same style of handwriting?

•   Does that final zero appear to cross over a period?

It’s much more common to see an altered dollar amount than a changed name because it’s a lot easier to add a zero at the end of a series of numbers than it is to change a name completely.

Can an Altered Check be Cashed?

It is possible to cash an altered check, but fortunately it’s fairly difficult to pull off these days, thanks to advanced security efforts. Banks use high-tech watermarks and other authentication and fraud detection methods to make it very hard to cash altered checks.

One of the reasons that banks take fraud detection so seriously is because the liability can fall on the bank if they fund an altered check.

Is It Illegal to Alter a Check?

It is illegal to alter a check and if the amount of the check is more than $1,000, altering it is considered a felony. For altered checks of less than $1,000, this crime would be prosecuted as a misdemeanor. All jurisdictions have differing penalties, and these penalties can vary depending on factors such as the check amount.

All forms of check fraud are illegal, including counterfeiting and payroll fraud.

What Types of Checks Are Typically Altered?

Let’s take a closer look at the most common types of checks to be altered.

Cashier’s Checks

How safe is a cashier’s check? It functions similarly to personal checks. The main difference between them is that with a cashier’s check the bank or credit union that issued the check guarantees that it will cash. Despite the fact that cashier’s checks have added security features like watermarks and signatures from two bank employees, they can still fall prey to check fraud.

Traveler’s Checks

A traveler’s check is a paper document someone can use to make purchases while traveling in other countries instead of using a normal check or cash. All traveler’s checks have unique serial numbers that make it possible to get refunds if the checks are lost or stolen. It’s important to be careful when traveling as criminals look for tourists to steal from.

Recommended: Can you deposit traveler’s checks in your bank account?

Money Orders

Money orders can be more secure than personal checks, but they can still be altered, so it’s always a good idea to pay close attention to the details. Similar to a cashier’s check, a money order is guaranteed by the issuer of the check, but instead of a bank this can be the U.S. Postal Service or a retailer.

Tips for Banking Securely

Check out the following tips for consumer protection.

Monitor all Bank Accounts

Keeping an eye on the transaction history of a checking or savings account can help consumers catch fraudulent behavior like altered checks while there’s still time to remedy the situation.

Frequently Change Passwords

It’s a good idea to change your online banking and other passwords frequently and not to use the same password for multiple different accounts to help avoid someone stealing login information and using it to commit financial fraud. It’s also helpful to not include personal information (name, birthday, etc.) in a password and to use a mix of upper- and lower-case letters, special characters, and numbers when creating a new password.

Only Access Online Bank Accounts From Secure Locations

You shouldn’t log onto their online bank account when using shared public WiFi at your favorite coffee shop. It’s best to only ever log into important accounts when using a secure connection like at home so no one can intercept and steal account login information.

Recommended: Cashing a check without a bank account.

Banking With SoFi

Check fraud is an unfortunate reality and that’s why it’s a good idea for consumers to keep an eye on recent bank transactions to make sure any checks they wrote were cashed for the correct amount. A fraudulent check is a check with altered information on it — such as the amount or payee information.

There are steps consumers can take to protect their financial lives when banking. For example, it’s always best to bank with a financial institution that is FDIC (banks) or NCUA (credit unions) insured.

All SoFi Checking and Saving accounts receive industry-standard FDIC insurance of up to $250,000 per member. Open an online bank account with SoFi. When you sign up for Checking and Savings with direct deposit, you’ll earn a competitive APY on savings, and you don’t have to pay any account or overdraft fees.

Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.60% APY on SoFi Checking and Savings.

FAQ

How do you tell if a check is altered?

More often than not, the payment amount is the part of a check that is fraudulently altered. Check the payment amount closely to see if it looks like an extra zero was added at the end or another number was changed.

How long does a bank have to return an altered check?

If you notice an altered check, ideally you should report it to the bank within 30 days. That being said, consumers have up to one year to report the loss to their bank in order to get the amount of the check returned to them.

What happens if you deposit a fake check without knowing it?

If you deposit a fake check without realizing you are doing so, you may be liable but oftentimes you aren’t. The bank that credited the account could choose to later reverse the funds if the check is found to be fraudulent. All banks have different policies regarding fraudulent checks.


Photo credit: iStock/AntonioGuillem

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