Calls are coming in to Check Guarantee companies all over the U.S., asking for "Guarantee" for checks accepted at check cashing facilities. In fact, it has ISOs almost giddy as they point out, "These businesses will pay almost anything, 10-15%, no problem." Imagine the opportunity...that is for thieves. That's right, thieves.
One of the negative side effects of increased technology is increased fraud. With the advent of lower-priced, higher-quality printers and scanners, just about anyone can set up a bogus check shop in their own home. In fact, that's just what two groups in Minnesota and New Jersey did. Both fraud rings used computers, payroll software, scanners, and high-end printers to counterfeit payroll checks.
"This is absolutely strategic, but unfortunately, it's not urgent."
The ringleaders in New Jersey operated on a grander scale, hiring people to cash the checks and leasing vehicles and chauffeurs to shuttle them around town. It paid offó$30,000 accumulated in less than three months! They purchased basic software for designing checks and hired people who would let them scan the authorized signature from their paychecks. They would then duplicate the check's design, attach the signature, fill in a dollar amount, and get someone to cash it.
"The organizers of the ring would pick up and drive these people to businesses who would cash the bad checks, usually in amounts between $300 and $500," said Camden Detective Gail Sharper. "A fee of $50 would be given to the check-cashers."
In each case, the checks were passed in-state. But, since those who cashed the checks in Minnesota have ties to other states, there is a concern that the check may be passed in other states as well. "It's not just the Twin Cities, really," Anoka County Sheriff Larry Podany said. "It's an Upper Midwest problem." In New Jersey police are investigating whether the ring also spread into the surrounding areas of Philadelphia, Washington, D.C., and North Carolina.
We will probably see more and more of this type of fraud, as software and hardware prices go down and technology advances. Detective Ed Egly, who worked the Minnesota case, said, "If you have the hardware, the software, and the knowledge of how to do it, it's a piece of cake." This is easier than printing money; in fact, it is printing money.
