Do you still mail check payments through the postal service? If so, you may want to think twice the next time you stick a stamp on an envelope.
FinCEN recently issued an alert to financial institutions on the “nationwide surge in check fraud schemes targeting the U.S. Mail.” In the alert, FinCEN provides red flags they have identified in coordination with the United States Postal Inspection Service (USPIS).
According to the alert, which was issued on Monday, February 27, 2023, criminals have been increasingly targeting both U.S. Mail and Postal Service mail carriers since the COVID-19 pandemic to commit check fraud. Criminals typically steal personal checks, business checks, tax refund checks, and checks related to government assistance programs, such as Social Security payments and unemployment benefits. Following the initial theft and fraudulent negotiation of the stolen checks, criminals may continue to exploit their victims by using the information they find in the stolen mail for future fraud schemes, such as credit card fraud or deposit account fraud.
Typically, thieves will target USPS blue collection boxes, unsecured residential mailboxes, and privately owned cluster box units at apartment complexes, planned neighborhoods, and high-density commercial buildings. Mail theft can occur through forced entry, or the use of makeshift fishing devices fashioned from boxes, plastic bottles or other items where they have applied an adhesive substance that sticks to the mail in a blue collection box and allows for it to be removed. The NYPD took to Twitter in 2017 with photos of mailbox fishing devices they had recovered.
However, according to the FinCEN alert, theft is occurring increasingly using authentic or counterfeit USPS master keys, known as Arrow Keys. Arrow Keys open USPS blue collection boxes and cluster box units within a geographic area. Sadly, several recent cases involve organized criminals violently targeting USPS mail carriers with the intent of stealing Arrow Keys. Stolen Arrow Keys may then be copied and sold on the dark web and social media platforms in exchange for virtual currency.
Once stolen, checks can be “washed” in chemicals to remove the ink. Some scammers will even use copiers or scanners to print fake copies of a check. In some cases, victim’s checks are also counterfeited using routing and account information from the original, stolen check. Fraudsters may also replace the payee and dollar amount or even sell the blank check to a third party to utilize.
Unfortunately, this threat isn’t new on the Central Coast. In 2020, there were multiple instances in Santa Barbara and Santa Maria of people stealing mail from USPS boxes and neighborhood mailboxes. In 2021, the Santa Barbara County Sheriff’s Office posted tips for preventing mail theft following the arrest of a Santa Barbara man for mail theft and numerous other theft-related charges. In 2022, a woman was caught after being seen stealing mail from mailboxes in Buellton. Remaining a relevant threat to the area, it is essential that people take preventative measures to protect themselves from fraud.
Visit our website at ARB.bank for helpful tips on how to protect your account from check fraud by using online banking. If you do need to write a check, take extra precautions to safeguard your checks and never leave the mail in your mailbox overnight. The USPIS is also providing useful tips on how to protect yourself from increasing check fraud attempts. They issued a video in September 2022 to explain how check washing works. There are many ways to reduce your risk, and whenever possible, you can avoid checks altogether by paying your bills online or signing up for automatic payments.
It is not just consumers that are impacted. In fact, FinCEN reports that while criminals will generally steal all types of checks, business checks may be more valuable to the criminals because business accounts are often well-funded, and it may take longer for the victim to notice the fraud. How can businesses protect themselves? Sign up for online banking and use ACH to send money for things like vendor payments, tax payments or payroll. You can also sign up for Positive Pay, a service that allows you to approve items for payment on a daily basis.
If you are interested in learning more about ways to protect your account from fraud, stop at any of our six local offices. In the meantime, thanks for reading, and stay safe!
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