n the movie "Bandits," Bruce Willis and Billy Bob Thornton play two real-life bank robbers who, on their way to Mexico after breaking out of prison, devise some farfetched capers to separate several banks from their customers' cash. One involved coming up behind a bank security guard and sticking a Magic Marker in his neck to make him think it was a gun.

That's entertainment. The true and fictional tales of crooks who make their getaways amid squealing tires and gunfire, who don ski masks and pass notes over the counter to the teller or who make fingers in their coat pockets look like weapons are good stories and create legends out of thieves.

But bank robbery is bank robbery, and it's no laughing matter. These days crooks get away with far more stolen money using ball point pens, high quality check stock and laser printers than they do holding up tellers at gunpoint.

Check fraud is one of the fastest growing crimes in the country, but the exact amounts lost by banks and financial institutions are difficult to estimate. There are the actual cash losses to tally, as well as the less obvious costs involved in processing each of the roughly 40 billion checks written each year, including expenses for fraud prevention procedures and labor.

Some estimates put totals from fraud loss for financial institutions at $800 million in 2002. As larger banks rally resources to combat check fraud, criminals have aimed their sights on small community banks, which saw losses triple between 1997 and 2001, and mid-size banks, where losses doubled in that period.

Enter Mitek Systems Inc., a company in Poway, Calif. that develops forgery detection solutions including image-based automatic fraud protection and recognition technologies.

According to Mitek, forged signatures were the single largest category of check fraud losses for commercial banks in 2002, comprising more than 16.9% of total cases. As criminals acquire sophisticated tools and methods, losses from other types of fraud, including counterfeit checks, are also on the upswing.

Fake checks and forged signatures account for more than one-third of all check fraud losses.

Mitek has several products on the market that provide solutions to verify signatures and authenticity of documents, including recognition engines and forgery detection, imaging and forms processing solutions.

Working with an established global network of affiliates, Mitek's goal is to provide customers with tools to reduce losses from fraud and speed the accurate evaluation of checks.

The company's technologies help banks of all sizes improve the way they process checks; although the systems work on different levels, they are very complementary to a bank's fraud protection program.

Murali Narayanan, the company's Vice President of Product Management and Business Development, said that Mitek focuses on developing image-based diagnostic tools to prevent signature forgery and counterfeit checks, growing areas of concern especially for small and mid-sized banks.

He cited an American Bankers Association report on check fraud from November 2004 that showed that even as check volume goes down, check fraud goes up.

"Check fraud is so easy, with all new technology," Narayanan said. "Law enforcement are so busy with other things. And the penalty is relatively light; if you rob a bank at gunpoint and take $100 from the teller, you can be arrested and put in jail. But you can write a check and withdraw thousands and go unpunished."

Less than 5% of community banks today are deploying any kind of technology to combat check fraud, and criminals have found this loophole.

Existing fraud prevention technologies are expensive and difficult to use; they've all been designed for the big banks. As a result, smaller community banks have to manually examine checks. Because these banks process 20,000 checks a day on average, they can only really look at 300 - 400 checks of higher values, Narayanan said.

Using old-school techniques like holding checks up to the light, looking for alterations or verifying them against a signature card on file is very slow and labor intensive. "It's very limited, because you don't catch a lot of fraud like that," he said.

Three community banks that have installed Mitek's FraudProtect System are now able to analyze all the checks they process daily and are catching fraud they never caught before, including more bad signatures and bad checks of lower dollar amounts.

Designed primarily for community banks with asset sizes of $10 billion and below, FraudProtect is scalable, and banks of all sizes can use it.

"Our value proposition to the community banks is that this is the same technology used by Bank of America," Narayanan said. "We say we're going to give this technology to them in a format that's easy to use and maintain, and is very affordable."

In a 15-week pilot completed by fall of 2004, Bank of America Corp. (BofA) used Mitek technology to process 41 million checks. BofA was able to identify fraudulent checks with average amounts of $500 - $600, totaling $2.4 million in Southern California alone.

Banks do not have to invest in any additional equipment to implement FraudProtect. A PC on the bank's network communicates with existing imaging systems to process up to 8,000 checks an hour. FraudProtect looks at signatures on checks that were processed recently, rather than comparing to old signature cards on file, for better accuracy.

With Check 21 now offering banks the option of truncating checks, another aspect of accuracy in checks is important, too: high quality images. If a bank chooses to truncate checks, the paper documents are destroyed and the bank instead uses an image of the check through the process. As a result, fraud detection is now based on those images; established tools such as water marks are now irrelevant in the Check 21 environment. Other tools, including signature verification, become essential.

Mitek's ImageScore system uses neural networking algorithms to test each image against potential problems. These include partial images, excessive skews and piggybacked images. Based on the results, ImageScore issues a quality score, which determines the usability of the image.

Without a clear, legible check image, an electronic transaction can't be completed, archived or, in instances of disputes, proven or authenticated. The bank's liability, and likelihood for fraud, increases. FraudProtect and ImageScore satisfy two separate but related issues in check imaging, Narayanan said.

In a bank's workflow chart, ImageScore would be a component of item processing and archiving and FraudProtect would fit into the fraud and risk management area.

Mitek's core competency is creating the technology for the highest quality image production and then backing that up with the highest level of analytical tools.

"We believe we are in the best position to set the gold standard for forgery and counterfeit check detection," Narayanan said.

"Our strategy has been to go directly to a few banks to learn, but grow the business through partners. Our partner relationships are extremely important.

"We are primarily a very unique technology company; we provide cutting edge technology that solves real problems for financial institutions. We worry about innovation, customer needs, and follow through after the sale. That's where our strengths are."

That's also why the company's relationships with its reseller channel partners are so critical to its growth.

A company the size of Mitek (of its 30 - 40 employees, eight hold doctorates) lacks the channel depth and breadth to cover the huge space that financial services encompasses, Narayanan said.

But through a global network of original equipment manufacturer (OEM) and channel partners, Mitek's recognition-based solutions process more than eight billion checks and other documents per year for a variety of customers in a growing market. At least 35% of all checks processed in the United States incorporate some form of Mitek's technology.

Mitek's Channel Partner Program provides marketing collaboration and sales expertise in imaging and data capture for agents looking for ways to expand their suite of offerings and fulfill their customers' needs. Channel partners receive leads, free technical support, sales and product training, demo software and a designated Mitek representative, among other benefits.

On the drawing board are new solutions to stop fraud at any point of presentment, when and where the fraud occurs. Many times this is at a retail store, where the merchant has no way of determining whether the check is legitimate or not.

For example, in a strategic partnership with Harland Financial Solutions Inc., a wholly owned subsidiary of check producer John H. Harland Co., Mitek will complete a pilot of technology for rollout by mid-2005 that will give merchants such a detection tool. The system analyzes the signatures on a customer's checks over time and through a secure encrypted code, prints a bar code when Harland prints new checks.

Merchants scan the check, read the bar code, capture and analyze the signature comparing it to the information on the bar code, and receive a warning if the check is fraudulent.

Mitek recently announced that Harland will make a $1.5 million equity investment in the company, expanding the relationship and Mitek's growth potential.

"Our goal is to prevent fraud in all financial transactions," Narayanan said.