So essentially someone writes you a check, you then bring the check into the bank and they take money out of that persons bank account and put it into yours. Just based on that slip of paper. So what stops anyone from writing fake checks, it seems like it would be really easy
(I’m a teenager so if this is completely wrong my apologies)
Edit: Thanks for the responses!
In: Economics
There are additional security measures taken if you try to cash (or deposit) the check at the bank it was drawn on. In other words, if I bank at Bank of America and write you a check… and you take it into your local Bank of America, they’ll look at several things. Including the check number. If I’ve recently written check number 100 thru 115, and you walk in with check number 873, thats a huge red flag. They’ll look at my signature they have on record and compare it with whats on the check. And obviously balance. If I have a 30/60/90 day average balance of $400 and wrote you a check for $750, red flag…
They will eventually contact the other bank to make sure that the sender has the funds available, if not they take the money back out of your account, charge fees, etc… This was a real problem back in the day, some lowlife people would write checks knowing they didn’t have the money and when the other person tried to cash it, the teller would say “your check bounced”. It was and still is a felony and is either theft (because you basically stole an item and pretended to pay it) or wire fraud depending on the jurisdiction. If you did it enough times they could blacklist you in the Chexsystem that banks use to determine credit status, which means you couldn’t get a line of credit or get a check book from any bank in the future.
Source: Old millennial.
Most places that take checks have a system in place that sends the information to the banks to verify if a check can be used. If the person has issues with checks bouncing they tend to get rejected. Also a lot of places you need your ID which they record information from on the check to verify it was you who wrote the check. Checks also need an account to get checks in the first place so if you write bad checks it results in overdraft fees that will cost you even more money. Lastly a lot of places have moved away from taking checks because of debit cards being so prevalent.
Checks have security measures on them that make them hard to fake. You can’t just print one.
Well for one it is fraud, so it becomes criminal. Two, most banks have you wait until the check clears before you can pull the money out. Three, the routing and checks themselves have anti-forging features in them that it is much harder to forge a check than it may appear. Four, many banks have digital readers to read checks.
It’s a crime. Since it’s pretty easy to figure out, with security cameras everywhere, you’re pretty likely to get caught. Going to jail sorta ruins your life for a while, and so not many people try it.
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The main way is the funds are “uncleared” for some time.
When you deposit a check, your balance increases, but you can’t take the money out just yet. So if you have $3000 in your account, and you deposit a check for $500, if you check online, the bank will tell you that there’s $3500 in your account. But they won’t let you take the last $500 out for several days.
If you ask for cash for your $500 check, your account will still have $500 of uncleared funds.
They’re more likely to have a waiting period, or make the waiting period longer, based on the risk factors of the specific check. For example if you’re a new customer, or if the check is for a large amount of money.
You have to know that person’s account number. The legitimate checks normally already have that number on them.
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